You may have heard the quote, “Money is 10% math and 90% psychology”. And I think it’s accurate. Our motivations to spend on something big can rarely be captured by a spreadsheet. Cue: going into Winners/Homesense/Target in a haze of boredom and leaving with $200 of random things I forgot about. 

Over the years, there have been times when my closet (and kitchen pantry) have transformed into a graveyard of things I thought I really wanted but brought no joy into my life. I was bored, or shopping to feel cool/hot/successful/more joyful. When we dive deep into questioning our own "why" - we can say buh-bye to emotional spending.

Here the three questions that have become a normal practice to ask before I make a big (or small) purchase: 👊

1. Why I am TRULY buying this?

Oof starting with a tough one, I know, I know. This is the time for some serious reflection. If we can be honest with ourselves, we can usually determine the true reason we are purchasing something. Do I want to keep up with my friends? Am I purchasing this to chase a feeling? Does buying this thing align with my values? These can be helpful prompts to dig deep into why we are rushing to buy. 

2. Is there a feeling I’m chasing that could be accomplished another way?

Do you fall into the common trap of emotional spending? Hi, yes me too! Many of us use spending money as a workaround to feel our feelings. We are chasing feelings when we buy things.

Some examples that may feel a bit too real:

• If I am chasing to feel more accomplished in my professional life, I buy a new Macbook to feel more professionally accomplished. 

• If I am chasing to feel more connected to my friends, I go out for multiple drinks at fancy cocktail bars with the girls, or join an expensive gym/golf club/spa. 

• If I am chasing to feel luxurious/fancy, I buy designer bags, shoes or pull trigger on an exotic travel destination. 

Sometimes purchases can make us feel the way we want to feel - and there’s nothing wrong with this! I’m all for spending money on joyful things I love! But often, they don’t. Or they can be accomplished in a much more economical way. 

Here are some alternative options for chasing our feelings:

• A more economical way of feeling accomplished in my professional life could be: updating my resume, creating a “brag letter” to share at my next performance review, reading old papers/exams I wrote in university. If you can reflect on how far you’ve come, you will be surprised!

• A more economical way of feeling more connected to family and friends could be: planning a games night or potluck at home with friends, meeting for a walk in a new neighbourhood with coffee or writing a (real) letter to a friend you haven’t caught up with in a while.

• A more economical way to feeling more luxurious could be: digging out old gift cards and having a spending spree, getting dressed up and ordering one cocktail at the fanciest bar in town, or having an at-home spa night with friends. 
  

3. Can I truly cash flow this purchase? Or do I have a sustainable plan to pay this off?

Okay so this on the math side of things. Ultimately, can I afford this without cutting so much that it’s just unrealistic? Or if I am going to use credit to pay, do I have a plan in place to pay this off in a reasonable timeframe without burning cash in credit card interest. 

For the record, yes, I am in the camp of most personal finance people: credit card debt is a my-hair-is-on-fire level issue. It’s financial quick sand to get out of when we are over our heads. I am also in the camp of life the timing happens sometimes not ideally, and that’s that.

💸 My own guidelines 💸

If purchasing a thing:

1. Aligns with my values

2. Will truly bring more joy, peace and ease into my life (AND cannot be accomplished another way)

3. Fits into my budget 

Then I’m going for it! Guilt-free, baby. 

How do these questions sit with you? Drop me a line at @frigginfinances on the ‘gram.