Anything that you do on impulse may not be right for you, and that applies to impulse purchases, as well. While online shopping has made access to products easy (you can select and order an expensive watch at 2:00 AM), options such as equated monthly instalment (EMI) facility on credit cards and buy-now-pay-later (BNPL) schemes have made it easy to purchase something even when one may not have the money for buying that otherwise. While we make ‘impulse purchases’ once in a while, here is how to avoid doing it too often.
Ask Why You Want To Purchase: Understanding the root cause of what causes impulse buying will help you deal with it better. Says Adhil Shetty, founder, and CEO, BankBazaar.com, a financial services website: “It can be for several reasons, from something as complex as retail therapy, because we are feeling too low or want to celebrate the moment, to something as simple as believing that we have an excellent deal. Or it could be because we were never really taught how to handle money well.”
Practice Delayed Gratification: When you feel like buying something, say a new phone or another pair of shoes, just tell yourself that you will buy it after a week or a fortnight. If it is not a genuine requirement, you will find the impulse evaporating over time. On the contrary, if you still want it after the time gap, maybe it’s a genuine need and you may go ahead with the purchase. On e-commerce platforms, there is an option to ‘add to cart’. You may use this feature to practice delayed gratification. “Practicing ‘delayed gratification’ is the primary method to avoid or reduce impulsive buying,” says Chenthil Iyer, founder, and chief strategist, Horus Financial Consultants, and a Sebi-registered investment adviser.
Make A Budget And Stick To It: When making a budget, do make an allowance for purchasing items that you may not really need. The good thing is that once you are bound by a budget, you will not go overboard.
“Another important aspect is to make a budget at the beginning of every month, in which you may add all the items that you need for the month. This would ensure that you would only stick to those things you plan to buy and won’t get carried away by something that is not on the list, however attractive the offer may be!” says Iyer.
Set Transaction Limits: Sometimes, you can play small tricks with yourself so that you do not end up spending on an impulse.
Says Shetty: “Figure out how much money you need for the items you want to buy and keep only that amount at hand. Use a prepaid card with that amount topped up, or set spending limits on your debit and credit cards before you start shopping.”
If you stick to your shopping plan and don’t have any extra money to spend, your chances of impulse purchases will be low.