Friday, October 30, 2009

By 

James W. Stone

Do you have a problem hanging on to your money? Do your friends refer to you as a shopaholic? Are you a spending addict? Whatever the label, it is possible to have a dependency on spending money. At this point you might be relieved to find out you have a disease.

It is the vogue these days to define a problem as a disease. There are two good commercial reasons for this:  First, we expect to treat a disease – and lots of people make money from this. Second, it's okay to get sick — it's not your fault. Now we can talk about your "condition" in public. If we can talk about a disease, somebody will try to sell you something to cure it. That's the American way.

I discussed this with my wife. She is an astute shopper. But we know some people we are a little concerned about. (Don't you?)  I said there is a big difference between a shopaholic and a spending addict. It is possible to shop without spending. She pointed out it is also possible to spend without shopping. Although I should have had that thought myself, I did not. I was caught off-guard and had to laugh.

The next question we discussed was the difference between (1) the frequent shopper who does spend money but who is trying to satisfy a dependency to the emotional high that comes from shopping versus (2) the spending addict who must spend money in order to feel like he means something to society, like he has value. While we might be able to find differences in the reasons for behavior, the effect on the bank account is the same in both cases. And some people are shoppers and spenders.

The shopper is putting themselves in a situation where they are likely to succumb to advertising, merchandising, and promotion. They are, in a sense, playing with matches. It can be exciting to read about new things you can buy. It is even more exciting to touch and hold them, or to see them used in demonstrations. It is thrilling to try on a beautiful cocktail dress and sexy heels. You look marvelous so you buy it. But – you won’t ever wear your purchases because you never go to cocktail parties. Shoppers often buy things they don’t need and will never use.

The spender starts by giving themselves permission to spend. They usually have a motive. It may, or may not, be something they are conscious about. The motive could be as obvious as the need to satisfy the ego of the "Big Spender," buying flashy clothes, expensive electronics, or even extravagant gifts for others. At the other end of the spectrum, the spender could be motivated to avoid feeling worthless, proving only to himself that he can still get the merchant to accept his charge card. Somewhere between those two extremes is a wide range of unique personal needs.

Either the shopper or the spender could be driven by the need to show their neighbors how successful they are. Either could be driven by the need to care for their children to the point of "pampering" them. Either could be satisfying an emptiness caused by relocation, a family breakup, or a job loss. We could try to identify the shopper and the spender as people with a disease, although the symptoms don't necessarily imply a clinical illness. The treatment is the same, at least to start with.

Both the shopper and the spender can break their spending pattern by doing three things.

First, make detailed lists of what you spend your money on. That's everything from rent to chewing gum. The effort to write down the details and to see where you are spending money is the biggest deterrent to future spending. It will help you understand yourself. You might want to compare that outflow of money to what you have coming in. Can you put more money into savings?

Second, define your objectives in life. What do you really want to do with your life? Who do you want to be? Set short-term objectives (goals) that help you stay on the path to get where you want to be. People who don't know what they're living for tend to act without determination. They will spend "mindlessly."

Third, when you spend money, make sure it is helping you achieve your objective. Know why you are spending money. Get the most bang-for-your-buck you can get. Learn why you want things you don't really need. Be aware of advertising that pushes your buttons.

These three steps help you use your mind to control your spending. When you take these three steps, you can identify the motivation that drives you to spend. Once you identify what is driving you to spend, you can deal with it.

So, are you a spending addict? Or do you just like to spend money. Make an effort to deal with it. Take the three steps. Engage your brain and get control of your spending.

James W. Stone
Copyright 2009, James W. Stone, all rights reserved worldwide