What is Emotional Spending and Why Do We Do It?
Kevin is a former fintech coach and financial services professional. When not on the golf course, he can be found traveling with his wife or spending time with their eight wonderful grandchildren and two cats.Read full bio
At a Glance
- Emotional spending is a mental health condition, not a bad financial habit.
- Common triggers for emotional spending are isolation and depression.
- Coping with stress or depression with emotional spending doesn’t solve the problem.
Have you ever done “retail therapy” after having a bad day? You’re not alone. Emotional spending was one of the most common coping mechanisms during the pandemic. Being isolated at home with only the television and an online shopping app can be a devastating combination. Amazon’s annual revenue increased by 20.45% in 2020.
What is emotional spending?
Emotional spending is a reaction to feelings that people are unable or unwilling to cope with. It’s an addiction because the need is to fill a spiritual hole with a material solution. The reasons for emotional spending include isolation, depression, and financial uncertainty. Emotional spending can easily cause financial unmanageability if left unchecked.
This phenomenon isn’t limited to retail shopping. Emotional spending on food is a common coping mechanism that leads to obesity and major health issues. What the outside world views as a physical problem could be a mental health condition highlighted by compulsive eating. It begins with discontent and escalates with guilt and shame due to overindulgence.
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Why do we spend when we can’t afford it?
Blame one-click buying for your recent impulse spending if you like, but there’s always a deeper emotional issue at play when we buy items we don’t really need. Some of it can be attributed to shopping addiction, but there’s always another need that we’re trying to fulfill.
Mental health experts attribute some of this to depression. The “new normal” of post-pandemic America is not the land of milk and honey we once knew. Prices are up, salaries have plateaued, and many recreational facilities are no longer in business. The dopamine rush we once got from amusement parks and music shows just isn’t there anymore.
Isolation is only one of several emotional triggers that cause us to turn to online shopping.
Combatting the mental illness of emotional spending
The stigma behind mental illness has been minimized by high-profile athletes and actors stepping forward and seeking help. It’s okay to not be okay. Admitting that is the first step in getting emotional spending under control. How many Amazon packages are in your garage? Did you need everything you bought? The answers to those questions are very telling.
Call it what it is. When your life becomes unmanageable because your spending is out of control, there’s a problem. The material impact of that problem is financial distress. The spiritual and physical impact is far more dangerous. Coping with stress or depression with emotional spending doesn’t solve the problem. It compounds it.
Seek help if you need it
What may seem like a harmless activity in the beginning can quickly get out of hand. Shutting the TV off and putting your phone away could increase feelings of isolation and despair. Don’t be afraid to seek professional help if you need it. Everyone is going through a tough time right now, so you’re not alone. Pain shared is pain lessened.