‘Retail Therapy’ Can Destroy Your Finances — Here’s How To Stop for Good
Did you have a bad day? Are you tired, stressed or just not feeling motivated? Congrats — you’re now the perfect target for retail therapy.
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The term “retail therapy” dates back to the 1980s, and was likely coined by the Chicago Tribune. If you haven’t heard it before, it means exactly what you’re probably thinking it means: Shop your blues away!
Though retail therapy can feel truly fulfilling in the moment, it can also wreak havoc on your financial health. Let’s explore why it’s so dangerous and how you can stop (or at least control) this behavior for good.
Many Americans Are Already Struggling Financially
With lingering inflation and poverty rates on the rise, the financial struggle for many Americans is stark and undeniable. As Dr. Erika Rasure, chief financial wellness advisor and financial therapist at Beyond Finance points out, even with consumers cutting back on their day-to-day spending, there are “alarming reports of loan and credit card delinquencies reaching new highs are surfacing daily.”
Given that so many consumers are already in a precarious place with money, it’s only logical that retail therapy, no matter how temporarily soothing, can plunge you further into debt and worsen your financial situation.
Why Are You Indulging in Retail Therapy in the First Place?
The main reason to avoid retail therapy is because it can hurt you in a financial sense, but it’s also important to understand why you have the impulse to shop your blues away. Get to the bottom of the problem.
“Another great reason to break up with retail therapy altogether is if you get an adrenaline rush from getting a good deal or being in a charged environment of positive shopping vibes, and just can’t seem to stop,” Rasure said.
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Use a Visa Gift Card Instead of a Credit Card
“If this is you, and you venture out for deals, consider getting a basic gift card, like a Visa, ahead of time and loading it with the amount of money you can afford to spend when you’re shopping.”
If retail therapy is causing you to overspend or wander off the tracks of your budgeting system, it’s wise to consider the cash-only approach when going to the mall or another shopping venue. Leave your credit cards at home and just go with cash or that Visa gift card.
“This is a great budgeting tool that can keep your finances intact,” Rasure said. “This is a strategy you can use year-round to help you meet your financial goals. Not a bad idea to also consider [the Visa gift card] for online shopping as it serves the same purpose there.”
What Do You Really Need?
Now, we must be careful when tossing around the term “retail therapy.” Avoiding it doesn’t mean you can’t buy anything at all. Rather, it’s a matter of balancing needs and wants — something you’ve probably already picked up from budgeting.
“If there is something you want to buy and you can’t live without it, by all means, take the deal if you find it for an amazing price, as long as you have the budget for it and can afford it without a credit card,” Rasure said.
Shop In-Person Instead of Online
There’s something about shopping online that can make money feel unreal or in greater supply than it actually is. Opt for shopping in stores when possible.
“While everyday shopping isn’t what it used to be, stores are still busy,” Rasure said. “However, retailers have been cautious with inventory and while those promotional deals exclusive to in-store purchases might be worth it, there’s no telling whether you’ll get your hands on what you want even if crowds are smaller. It might be a lot of time, effort and headache on your part. And if so, it’s an easy decision not to participate. Level with yourself to determine if this is an absolute must have or something you would just like to have but can wait on.”
Reconsider Splurging On Others
Retail therapy doesn’t always mean shopping for yourself; it can also mean shopping for others, which can be just as satisfying and perhaps feel even more justifiable. Be mindful about what you really can and can’t afford when it comes to purchasing gifts for loved ones.
This can be especially tough when shopping for your kids. In this case, suss out whether you’re not only shopping to cheer yourself up, but also, perhaps, because you feel obligated to do so for others and really prioritize and hone in on deals.
“For those of you with children, it’s an obligation that’s hard to get out of for many obvious reasons, but the most difficult one being the joy you know your kids get from gifts and special treats,” Rasure said.
“Because the joy exists, it might not be a great idea to break up with shopping altogether, but rather focus on getting the deals on the gifts that your kids will love,” she said. “Get the deals for the people who have priority in your life, including yourself, and try to save your money by cutting back on shopping for those who don’t have priority.”
Retail Therapy Isn’t Necessarily Always Bad, but You Have To Be Careful
Though there is an abundance of evidence that retail therapy can be a pretty dangerous coping mechanism, it’s worth recognizing that it isn’t always a harmful move to make — provided you are incredibly sparing, cautious and self-limiting.
“Retail therapy in a measured approach isn’t necessarily the worst thing,” said Zach Robbins, founder of Loanfolk. “Think of it in dieting terms: if you forbid yourself from ever having even a bite of dessert — or ever buying something that brings you joy — you will eventually start to crave what you’ve forbidden and end up binging or splurging.”
If You Must Splurge, Practice Extreme Moderation
Sometimes you really need to let loose and buy yourself a little treat. That’s OK, provided you practice moderation and stay within the boundaries of your budget.
“The adage is true: everything is in moderation,” Robbins said. “The issue with retail therapy is that it can be really hard for people to maintain a high level of discipline over the long term. This is exacerbated by the fact that there are more ways to get access to credit while being more physically removed from our money than ever.”
Consider Talking With a Financial Therapist
If you’re really having a tough time breaking up with retail therapy, it is wise to enlist the help of a financial therapist.
“Financial therapists can help you find the balance between money matters and mental health, ways to tackle anxiety related to money, strategies for saving toward your goals and more,” Rasure said.
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This article originally appeared on GOBankingRates.com: ‘Retail Therapy’ Can Destroy Your Finances — Here’s How To Stop for Good
