Just about everyone is feeling the squeeze these days as jobs are on the line and the cost of living continues to rise. The economic downturn has turned even the most extravagant spenders into frugal penny pinchers. Despite constantly having one eye on our finances, we highlight some surprising figures published after research into spending habits.
It found that eight out of 10 people suffer from buyer’s remorse – the term given to the feeling of regret after a purchase. With 15% of those 40 million feeling a sense of regret because of the cost, it seems that we could be overspending unnecessarily.
The most common purchases we wish we’d never bought because we ‘couldn’t afford it’ include cars and motorbikes (28%), pets (42%) and holidays (38%) because of the expense. It probably should come as a surprise that these are the most unaffordable splurges as they’re either huge one-off costs or ongoing expenses that will drain our bank balances.
Although cost is a major contributor to buyer’s remorse, it’s not the only one. Other reasons for our regrets are that we don’t actually need the item, or that we didn’t like it, never use it, or it was poor quality.
The items at the top of the list of most-regretted items were clothes and shoes, with 62% and 36% respectively. However, there are other things we end up wishing we’d never bought too, such as ‘stuff on holiday’, kitchen appliances, gifts, gadgets, gym equipment and games.
It seems that once we’ve realised our mistake, our rational process for recovering our cash goes out the window. Most of the time (57%) we keep the item anyway and only 8% actually go back for refund.
Spending beyond our means
This new information about buyer’s remorse is quite shocking considering that so many people are even struggling to cover basic expenses, like their household bills.
The average household debt in May was just over £54,000. In the same month we paid £164m every single day on personal debts and every 5 minutes someone was declared bankrupt. The number of regretted purchases, combined with total credit card spending of £1.455m, suggests that consumers are definitely spending beyond their means.
It doesn’t matter how frugal you are throughout the month, if you can’t stop buying on impulse, all that hard work will go to waste. In fact, this kind of spending can completely ruin budgets.
If you find yourself regretting purchases on a regular basis and can’t afford to continue buying items that you don’t need, take a look at these top tips to help you avoid splashing the cash.
How to stop impulse buying
1. Leave the plastic at home
Unless you are going out shopping for something in particular, try leaving your credit cards at home. If you’ve only got a certain amount of cash or prepaid card funds with you, that’s all you can spend. By leaving the plastic at home, you won’t need the willpower to resist temptation.
2. Don’t make up excuses
If you’re already in debt, it’s easy to say that further spending doesn’t matter because ‘what harm can it do?’. By making up excuses that allow you to impulse buy, you could end up sending your debt spiralling out of control. Remember that interest charges can send the price of an item soaring.
3. Take a list
Whether you’re buying the groceries for the week or Christmas gifts for the family, always shop with a list. This way, you’re less likely to buy things you don’t need because you have already planned what you’re spending on. Make sure you don’t add to the list as you go for a spin around the shops – that’s cheating.
4. Set a time rule
You can prevent buying on impulse by only allowing yourself to buy something after a waiting period. It doesn’t really matter whether you make it a day, week or month, but the longer the better. By forcing yourself to wait, you’ll be able to determine if you needed the product in the first place.
5. Ignore sales
As you’re walking around the high street, you’ll spot huge red banners in the shop windows enticing you in with their discounts. It’s important that you ignore sales. Remember that a lot of sales aren’t actually offering value for money as the retailers may inflate the price before the reduction anyway.
6. Remember your financial targets
Whatever your goal, whether you are trying to clear debts, save for a deposit on a house or contribute more to a pension; keep this in mind when considering an impulse buy. Spending £500 on a last-minute holiday, even if it is a great deal, is not going to do anything to help you realise your target. Just think about what that money could be put towards instead of ending up with buyer’s remorse.