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Your brain is wired for impulse spending

Drawing of a brain lighting up with a white outline on a blue background.

Have you been the victim of impulse spending?

Have you ever found yourself about to buy something you think you need but don’t?

Think about it: It’s the end of a long day. You check your Facebook or Instagram, click on a story in your feed, and before you know it, you’re halfway through the checkout for something you didn’t need, or even want! You might have fallen into the trap of impulse spending, and advertisers are counting on that.

Before you buy, it’s helpful to know what’s going on in your brain and how it might trick you into buying something you’ll regret later.

This is your brain on shopping

Researchers at Stanford found that when you see pictures of items you’d like to buy, a region of your brain with dopamine receptors is activated.

Dopamine is a neurotransmitter that helps control the brain’s reward and pleasure centers, enabling us not only to visualize rewards, but to take action to move toward them.

In general, dopamine receptors are activated when you experience something new, exciting or challenging. This could range from eating something tasty to winning a game to buying something.

Yep, this is what your brain is doing when you’re about to make an impulse purchase: it’s releasing lots of good old dopamine and that makes us happy.

Why am I an impulsive buyer?

That rush you get when you snag a bargain? It’s real.

Studies have shown the simple act of shopping lights our brain up with dopamine – the “feel good” hormone. That’s why it’s so hard to kick our spending habit. It’s a continuous battle to balance immediate wants and long term needs. 

The thrill of the hunt

Surges in dopamine can begin when you start thinking about shopping. This can happen days or even weeks before setting foot in a store.

The rush is not just about the things we buy, but the thrill of the hunt. Just knowing this might help you resist the next time you’re tempted to buy on impulse.

Ask yourself, is it the dopamine talking or do I really need this?

So, how do we fix impulse buying?

Wait it out

Flash sales and online purchases make it easy to spend impulsively. And to spend quickly. If you give yourself some time, you might decide you didn’t need that purchase after all.

Set a limit. Maybe its $20, $50, or $100. But make a deal with yourself that if it’s over that amount, you will wait a day or more before your purchase it. Not worth your time to head back to the store? You have your answer.

For items under that limit, for every dollar you spend, give it a minute. Costs $15? Wait 15 minutes. Give yourself some breathing time.

Spend mindfully

We all have spending weaknesses; it might be restaurants or the semi-annual sale at that little boutique.

If your knees go weak at a sale, just remember, if you don’t actively need that item (note: want versus need) keep walking and move that money over to your savings account for something you REALLY want.

Identify your spending traps and evaluate what is practical.

Maybe you need to add in some extra spending money into your budget to help you avoid temptation. It’s about finding that balance to live well.

Don’t just avoid your impulse – deal with it head on.

Save the amount you splurge

What happens if the splurge is happening?

You’ve made the decision to take the leap and buy what you want. That’s okay every once in a while!

Just make sure to transfer the same amount you spend into your savings account. Even if it was just $25. That money can be adding up while you enjoy your purchase. (It also essentially doubles the price of the item and is another great way to decide if you really need it!)

Didn’t make the splurge? Transfer the amount you would’ve spent on the item into savings! Get the rush of the splurge with the benefit of saving.

With Numerica’s Bonus Saver account you can earn up to 3.10% APY on your balance of $2500*. That’s extra money in your pocket for making a commitment to save and just letting your money hang out. Let your money make you money.

Be careful using a credit card

Don’t end up spending more on your splurges by having to pay credit card interest. Pay off your credit card as you use it. Or try using a debit card which lets you budget in real time. If you have a Bonus Checking account, you can also earn interest on your balance when qualifications are met. 

When it comes to paying, avoid saving your payment information online. Being able to pay with a scan of your thumbprint or having your information stored is just too easy!

When you have to input your payment information each time, it can really help you make a conscious decision.

Wrapping it all up

Having a budget isn’t about depriving yourself. It’s about spending mindfully. You have goals. Numerica wants to help you achieve them.

So, before that next purchase take a moment to make sure you’re:

  • Not doing it for the thrill of the deal
  • Realizing if it’s a need or a want
  • Spending mindfully and within budget
  • Saving as much as you’re splurging
  • Not over spending by paying with credit

Don’t have a Bonus Saver account yet? What are you waiting for?! Find a branch or call 800.433.1837.

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Here's the legal stuff. *3.10% APY (Annual Percentage Yield). Terms and conditions apply. Membership fee may apply. Earn more moolah, with as little as $25 per month. Deposit bonus - 1.50% APY after six months of consecutive deposits. No withdrawal bonus - 1.50% APY after six consecutive months without a withdrawal. And just like our regular savings account, you already earn .10% APY. Rates and APY are accurate as of 10/1/18 and subject to change after account opening. APY is accurate as of the last dividend declaration date. Bonus rates apply to the first $2,500 in the account when qualifiers are /met. Fees may reduce earnings on the account. APY = Annual Percentage Yield. Open Bonus Saver with only $25.

 

 

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