We’ve all spent money on things we wished we hadn’t. Regretting the things you purchase is a real blow to your confidence. Can I really make a decision? Do I know what’s good for me?
I found myself asking these questions more, especially if I was moving to a new house. The number of useless items I found when cleaning out my closet shocked me; clothing I had purchased more than a year ago was still sitting in the box unopened. I remember being excited when I bought those items, but by the time I got home, I had already lost interest. Why did I keep doing this? How do I break the cycle of poor spending and regret?
The psychology of regret
Regret is interesting compared to any other negative emotion because it’s based on how you think. If you don’t think about those ‘what if’ situations, you aren’t really going to experience regret. People experience regret because they think about the past and what they could have done. In a funny way, regret is necessary. Behavioural economists know that regret is a negative reinforcement that spurs people to self-correct. It’s infuriating to get your car towed, right? But it also means you’ll become more vigilant about reading parking signs in the future. Similarly, regretting a purchase is often the most direct way to avoid making the same type of purchase again.
The business of regret
Businesses are aware of the effects senses can have on our brains, and they exploit them to make us buy more of what we don’t need. To fight against being exploited, implement more cognitive effort. Cognitive effort involves performing research, gathering opinions and exploring options before purchasing a product. It’s not a cure but certainly is a form of treatment. Studies have shown that people can still feel regret if they put forth cognitive effort but are still dissatisfied with the product, but consumers can feel less regret if they decide ‘I’ve done all that I can’ instead of, ‘I should have done more, and this is my responsibility’.
Buying something in stores has multiple aspects. You can feel and experience an item in stores and the emotions associated with touch are an important decision factor. That’s why researchers think online shoppers try to read comments of other buyers because they’re trying to compensate for the fact that they can’t touch a product in an online store.
There are a few tricks we can use to counter the effects: First, don’t shop when your senses are working in overdrive. Researchers have found that we buy less at the grocery store when we shop on a full stomach. Similarly, try to avoid making a purchase when you are excited about something. It seems counterintuitive, but excitement enhances your desire, which in turn excites your senses, leading to a willingness to pay more. Finally, make two decisions instead of one. Once you choose to purchase something, leave the store and come back a few minutes later. If you still want it, chances are greater that your senses only played a small role.
Give yourself a break
There’s a big difference between making a habit of recklessly spending and splurging on an item occasionally. We’re often made to feel like if we spend any money on non-essentials we’ve failed — and as someone who writes about saving and budgeting frequently, I know I bear some responsibility for perpetuating those ideas. But in the grand scheme of things, a onetime R500 purchase isn’t going to make or break your finances. If it does, we need to be having a separate conversation with you. Stop reading and call me.
Spending slightly more than you have or taking on debt isn’t a moral failing. There are many circumstances we simply can’t control and others that it takes time to learn how to control. With any type of goal, a minor setback can seem irreparable. Forgiving yourself, fixing the problem and moving on is a much better use of your time than beating yourself up about a few splurges.
I don’t say this to dismiss all impulse spending as fine and wonderful. But if you’re generally mindful of where your money is going, give yourself a break occasionally.
Remember the pain
No matter how good retail therapy may feel, if it puts you in a precarious financial position, then sooner or later you’re going to hate what it’s done to your stress levels. In turn, you will start to resent yourself. All I’m advocating for is a little fiscal responsibility. You can have good spending habits. You can save and invest enough. You can be debt-free. It just requires some discipline, guidance from your advisor, a lot of patience and time.