I feel like I should introduce myself. “Hello. My name is Elissa, and I am an unconscious spender.”
“I give myself a $200 allowance every two weeks, but when the cash is gone, I use the credit card or hit the ATM. A hundred here, a hundred there. I feel like that Fast Cash $60 button is a slot machine in a casino!”
I am an impulse buyer from way back. I have a shoe addiction. I love nail polish. Also, position something strategically by the cash register with a cute sign, and I’ll buy it. How many lip balms does one woman need? And lattes! Don’t even get me started about lattes.
But I am not alone. In fact, the “Latte Factor” is an actual thing. Best-selling financial author David Bach coined the term to symbolize the high cost of small, periodic spending. Bach has gotten rich writing books bought by people like me (were they positioned strategically by the cash register?), as have many others, including Dave Ramsey, Suze Orman, and Napoleon Hill.
It’s a multi-gazillion-dollar industry. Type ‘saving money’ in Amazon’s search bar and you get 69,286 results. “Pinch Like You Mean It! 101 Ways to Spend Less Money Now”, “Saving Money: The 40 Tip Cheat Sheet for Peace of Mind, Effective Budgeting and Financial Success”, “Living Well Spending Less: 12 Secrets of the Good Life.” And on and on.
The struggle is real
But I wanted more than just me, so as all good journalists do these days, I turned to Facebook. Friends, I posted, are you an unconscious spender?
~ I can’t go to Walmart without buying a shirt. I’ve tried to resist, but those tees, those colors, those red discount labels. How can you resist a $5 shirt?
~ I am a big sucker. I go to Whole Foods for a few fruits and veggies and come home with a grow-it-at-home mushroom kit. I go to Bed, Bath and Beyond and lord help me if there is the “as seen on TV” section – although the dozen sham wows are amazing! And if GMA deals and steals are on, watch out ( great prices for a lot of stuff I don’t need).
~ Dishes call my name. Katie…woohoo…over here. You don’t have a festive set for the 4th of July (or Labor Day) or Mardi Gras). When we down sized to move to Florida we had 15 sets of dishes. We are down to 5 (I snuck a set in the boxes). I have to stay away from Pottery Barn because as soon as I walk through the door I hear them calling.
~ I go (to any store) with a list in my mind. My intentions are to get what I need. Then before I even get to the register somehow and without no explanation I’ve become a ‘MAGNET’…….yes a magnet. I have things that I don’t even remember picking up and I’m paying for them.
There’s certainly comfort in company! I decided as the first step in figuring out this flow from wallet to world was to keep a diary, a money diary, to track my spending for a week and then begin to assess and (possibly) take action.
Here’s the rub — as soon as I was conscious of my unconscious spending, I wasn’t spending! Or maybe I just wasn’t out and about. One strategy I have long held is called DON’T GO IN THERE. It applies primarily to Target and DSW. If you don’t go into DSW, you can’t come out with 4 pairs of adorable new shoes (which technically you saved money on because of all your points). So I’m not sure how accurate the diary is, because I was actually paying attention.
And some of the spending isn’t unconscious, it’s just the result of bad planning. Specifically I am addressing the use of the credit card, or as I like to call it OH MY GOD I AM OUT OF CASH. I had several cases of that during the week, including my daughter’s prom hairdo and my brother’s birthday present. If I had planned better, or let’s be honest if I had planned at all, I would not have needed the credit card for those two moments.
Quick sidebar: I’m not saying I use a credit card to build up debt. That’s always a bad idea. Rather, this is about reaching for the credit card when you go over your pre-planned budget of cash for discretionary items. Also bad.
Let’s add it all up
My total ‘unplanned’ (since I was conscious of it) spending for the week was $85.91. This included:
- An iced tea/lemonade at Starbucks because I drove by Starbucks when it was warm out,
- A curry rice bowl for lunch because I was walking down the sidewalk and the aroma coming from inside the restaurant literally pulled me inside,
- 4 packs of gum because they were on sale at the CVS checkout,
- 3 eye pencils because I walked down that aisle of CVS on the way to pick up a prescription,
- 2 jars of facial moisturizer because I had a coupon but when I got there the buy-2-get-one free deal was ‘better’,
- 2 half gallons of Friendly’s ice cream at the Big Y because they were $1.98 each and they are usually $6.99,
- A pair of earrings, jar of local honey and a reusable sandwich wrapper at the store where I work because I went to buy my mother a gift and saw these things for myself.
Spending that went on the credit card because I did not think ahead included:
- My brother’s birthday present, because I remembered his birthday the morning of his birthday ($26.90 included shipping)
- My daughter’s prom hair because she decided the day before prom she wanted prom hair and I had to scramble to find a place that wasn’t booked ($75 plus $10 tip)
- 1.75L bottle of Jose Cuervo margaritas because friends were coming for the weekend and I forgot we were out of booze ($20.20).
There is hope … and help
We also asked the unconscious spending question on the Get Rich Slowly Facebook page, and there was a lively discussion about the benefits of zero-based budgeting, in which you budget and track every dollar. But, wrote one fan, “tracking (is) only half the action. Once we started paying attention to where our money was going it allowed us to assess the value of those things. Eating out was probably the biggest eye opener.” (Sigh. I am famous for my Thursday night shout, “Who wants to eat out?”)
On my own Facebook, friends weighed in with their strategies that either keep them on the straight and narrow or helped them break bad habits.
~ As an environmentalist, I find it easier and easier to only buy what I need, while aiming for long-lasting quality products. The transition was difficult, and now it’s nice spending on experiences rather than things. It’s also nice not having to store/manage so many things.
~ We tried something that really worked: discretionary purchases (shoes, loaf pan, camera accessory, notebook, etc) are only allowed the first week of the month. It was surprisingly liberating. For three weeks a month, (other than food/gas/fees) I didn’t have to make any decisions about whether something was useful, could be useful, was something we needed, etc. And it really saved thousands of dollars over the months.
~ We live within a budget but I budget for fun as well. As I’m getting older, I enjoy experiences more than material things.
~ I started using Excel spreadsheets and saw how quickly savings add up. We’re buying a new house and I’ve started doing it again. Starbucks misses me, I’m sure.
And of course, there’s an app for that! One friend recommended Mint, which is highly rated. There are others, all of which compile all your information and then, I don’t know, zap you with electricity when you overspend. Not really, but sometimes it seems like that’s what it will take. Now firmly in middle age, I look back at all the money I did not save in my youth and I think … I could buy a lot of adorable shoes with all that cash! NO! STOP!
Consider me a work in progress.
Photo illustration by Get Rich Slowly. Images by iStockphoto.com and Elissa Bass
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