Experts in psychology and consumer buying behavior state that impulse buying behavior is exhibited when purchasing is executed without proper planning and research which results in a stimulus to take a decision on the spot.
Surveys say that this has mostly resulted in regretting later about taking a decision as such. So, have you wondered why is that we are under the influence of certain factors and get pushed into an impulsive buying spree?
Festivals bring about an air of joy and happiness in the minds of people. And many financial institutions try to harp on the good will to make the maximum business possible during that fiscal year. Attractive offers on loans with subsidized interest rates, huge discounts on products which you have eyed for a long time with a clause on the time frame for buying it, are usually a few of the marketing pitches thrown around to make buyers bite that impulsive buying bait. Impulsive buyers usually fall prey to this as they hardly practice disciplines like researching information or evaluating for alternatives.
As a buyer, you should be meticulous and have your research thoroughly done to avoid purchases which might cause a huge impact on your cash outflows.
Here’s how you can spend wisely:
Try and avoid carrying your credit card – The Plastic plays with your emotions and makes you pay hard later.
Have you noticed that the reason behind most of your unplanned buying? It often happens with your credit card? Credit cards offer an immediate financial leverage to spend with a delayed accountability, thereby making you land into a swamp of financial stress. If shopping is on your cards and if you are prone to such impulse buying, then it is a wise act if you decide to leave your credit card at home and pay for everything that you have planned to purchase only in the form of cash. Using a credit card will only increase your impulsive buying as it makes you feel that you can spend up to the limit and pay before the due date.
Meticulously study and understand the offers:
Every organization thrives on surveys done by its marketers who find that most of the buyers are lured to the fact of the ‘loss-aversion’ concept. “ Save up to 50% during this period “ should make you think laterally that the product is also available on a 50% discount otherwise and also that it is not a fast moving product for which the manufacturer or the retailer is willing to forego 50% as a discount in order to reduce the shelf space it occupies. Loss aversion is a concept which makes you feel about the additional cost you would bear in making that purchase if you had to buy it later. But have you reconsidered that thought of spending by evaluating if that expense could be utilized for something far better than this purchase? Introspect on your decisions. Offers with 10% or 5% could actually be worthwhile rather than opting for products that give 50% discount, with additional 10% cash back on credit cards and easy EMI plans. It is only ideal that you examine every possible outcome of such a purchase in order to overcome the loss-aversion fear.
Avoid experimentation in decision-making.
Let’s assume that you have decided to purchase every single product from now on, be it grocery or a shoe to a car, by thorough research and analytics. This could be really time consuming, tiring and finally make you resort to that usual method of taking decisions based on factors which might have been used in the past. This exactly is what manufactures and retailers try to leverage on thereby making you get attracted to freebies and extras. It is definitely worth spending that extra time in deciding whether it is really essential for you to spend on that product keeping in tandem about all the future commitments in place.
Plan a monthly spend chart
Planning though is just an idea to help you streamline your finances, adhering to it plays a vital role. Do not plan for anything that it unnecessary. If it’s a mobile phone, replace it only when it cannot be repaired anymore and not because an upgraded version has been launched. If a vacation is planned all of a sudden, decide on what happens when you get back and face the other expenses over the next few months. If you can arrange make shift plans like cutting down on shopping for a vacation, or cutting down on fuel expenses by opting to go by public transport for purchasing a new LED TV, then adhering to the plan is the most important virtue rather than merely deciding to buy a product when you set your eyes on it.