It’s not an uncommon practice in America to go shopping when stress becomes too overwhelming. There’s even a colloquialism for it — “retail therapy.” But while shopping can provide a short-term emotional boost for some, that high eventually wears off. And for those whose finances were in turmoil before their impromptu shopping trip, it can cause some real damage.
Sadly, 50% of millennials in a recent survey by LendingTree admitted that emotional spending — “retail therapy” — has hurt their financial well-being. And it’s not just millennials — 49% of Gen Zers are in the same boat, along with 44% of those in all age groups.
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Whether you’re a millennial or not, here are some ways that you can get your finances back on track if your emotional spending is causing financial problems.
Build a ‘Spending Fund’
An emergency fund — one that covers things like unexpected car maintenance and medical bills — should be the cornerstone of your financial plan. But if you have a propensity to spend when you get emotionally or financially stressed, building a secondary “spending fund” might be a good idea.
This way, if you give in to your indulgences, you can draw from this fund without damaging your overall finances.
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Take a Day
A common suggestion for those who are subject to impulse buys is to wait 24 hours before spending a certain amount of money. If something catches your eye that is more than, say, $50, you make a pact with yourself to delay the purchase for at least 24 hours.
Oftentimes, waiting a day is enough to diffuse the impulse, and you’ll find out by the next day that you don’t really “need” or even want the item.
Remove Temptations
Marketing has become a true art form in today’s society. You may not even realize how many targeted ads reach your eyes and ears every single day, cajoling you to spend your hard-earned money. Ad research has gotten so sophisticated that it’s highly likely that the majority of ads you see are actually things you might be interested in buying.
Under that type of bombardment, it takes a resolute shopper indeed to resist all of the temptation. The best thing to do is detach yourself from the system as much as possible. Unsubscribe from mailing lists and stop giving your information to companies or websites that can sell it to marketers. Most of all, avoid searching shopping sites, as they are trained to show you products that you’re most likely to buy.
Find a Different Outlet
Impulse shopping, for many people, is a coping mechanism. If you’re among them, you might not even love shopping — you just use it as an outlet for when you get stressed.
If this is the case, look for a different outlet for your stress. Go for a walk in the park, spend time with friends or family, or take up a new hobby. Try something new to keep your mind off your stress and your money in your wallet.
Automate Your Savings
If you “pay yourself first” by having money automatically transferred from your checking account to your savings, you’re less likely to derail your financial plan. It’s much easier to get in financial trouble if you wait to save until the end of the month, after you’ve paid your bills and spent money on discretionary items. But if you set up automatic transfers every month, that money is out of your reach before you can spend it impulsively.
The Bottom Line
People can get emotional when finances are tight, and impulse spending is unfortunately a common outlet. This is particularly true in today’s economy, with high interest rates and inflation pushing many household budgets to the limit.
But giving in to emotional spending will only make things worse, not better. Use these tips to reclaim control of your finances and break out of the habit of impulse spending.
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This article originally appeared on GOBankingRates.com: Half of Millennials Say Emotional Spending Hurt Their Financial Well-Being: 5 Ways To Get Back on Track
