Shopping has become a hobby for most people in the last decade. The advertisement industry is now completely focusing on people towards Emotional spending and ultimately spoils our financial planning.
The advertising agencies invest a huge amount on how to attract young people age 20-40 and live with those products they want to sell.
Have you ever gone to the appliance showroom? It makes us live in their world of spending. This is good for the country’s economy and GDP. But, this will never make us financially stable.
EMOTIONAL SPENDING DEPENDS ON MINDSET:
Emotional spending makes us do the expenses to live our life like others. We live in a society where we live for pride, we think doctors and engineers are the only best way of the profession. Drivers, carpenters, farmers, and electricians are not professions and not the perfect way to earn.
The interesting fact is, even the Tea shop owner near IT Park makes more income than an IT employee. People think status on the type of job and not on income.
In the same way, emotional spending is also related to mindset.
Emotional spending is meant to be the expenses done without controlling our emotions. The transactions which happen without taking any time to decide and grabbing instantly, without having a check on our bank balance. This is a specific mindset, which is filled in the current generation and this will lead to a life filled with debts.
OFFER – THE BIGGEST SCAM:
More than any scam which occurred in past, Offers will be the biggest scam of our financial life. Always you should understand there are expenses to be done for living.
We tend to buy products seeing the offer, rather than having a thought on is this really matters?
Amazon and Flipkart are spending too much money on offer to attract a customer base. They launch Big Million day kind of offer programs and make people a spendaholic.
We tend to buy a new phone, dress and other stuff only because of the offer and really we don’t need it. We will be having enough stuff with us.
There are people in this world, who justify themselves on purchasing the unwanted as they need it for sure. This is what I mention in the previous heading on mindset.
If we require a product, buy it even it is not in offer. If we don’t need a product, don’t buy even it is free.
Getting exposure to more products will increase our financial commitment.
PERSONAL LOAN APPS:
They target the people, who are not eligible for bank loans. Their salary will be less than 15K per month. Even they target people who are in school and college.
It is very easy to avail of loans through this app. There are many students who buy mobile, tablets through this app. They provide a loan amount of Rs. 1000 – Rs. 5, 00,000.
This is the main reason for emotional spending and this makes people be spendaholics. Most students create huge debts by side even before being employed.
Alongside, peer-to-peer lending adds to the market for emotional spending.
Role Of Temptation in Emotional Spending:
We people are generally weaker in handling emotions. The main reason is our temptation. We all use to inspire the new products bought by our friends.
There are many people who use to buy all new mobiles launched by brands like Apple. They won’t care about what they are having is also apple mobile.
The temptation is with everyone. People who can handle this are well managing their financial life. Those who cannot handle are the prey to it.
When we see our neighbour or relatives purchasing a car, home, or starting a new business. We also tempt towards buying those materialistic objects without knowing its use for us.
This is natural for all of us. To avoid these mindsets, we have to understand our goals and desires in life. Having the mindset of delayed gratification.
Even before purchasing a dress, just think 1-5 times whether really we need it. Replace the dress, don’t accumulate it.
· Emotional spending will always destroy financial planning.
· There are many ways to tempt us and increase our spending.
· Advertisements are made in a way to trigger our emotions and will keep us spendaholics.
· Offers is the big source for misleading in our financial stability.