You’ve probably heard of “doom scrolling,” but have you heard of “doom spending”? This is an issue for many people. A recent Intuit Credit Karma study found that 27% of Americans are doing this to deal with stress. Factors such as rising cost of living, inflation and lack of affordable housing are creating additional financial stress.
Are you spending more than you can afford to deal with anxiety? Find out what you can do to stop overspending so you don’t harm your finances.
Concerned about the American economy
If you’re feeling uneasy about the economy, you’re not alone. The Intuit Credit Karma study revealed that 96% of Americans are concerned about the current state of the economy. Of the study respondents who are concerned about the economy, these are their top concerns:
48% fear they don’t have enough money to meet needs like food, clothes and rent
34% people are most worried about getting into debt
30% are worried about not being able to spend money on things that make them happy
How are Americans dealing with these fears? More than a quarter are “disruptive expenses”. The study defines it as spending money despite concerns about the economy and foreign affairs to cope with stress.
Although spending money on things that make you happy may initially provide some stress relief, overspending can lead to consequences that cause more anxiety – such as debt.
How much debt? The same study found that nearly a third of Americans’ debt levels have increased in the past six months. And of those with debt, 74% estimate they have more than $10,000 in debt.
Don’t let your spending habits harm your financial situation
If you’ve been considering overspending yourself as a way to cope with the state of the world, you’re not alone. But it’s important to consider how your spending habits affect your finances. If you find yourself frequently making unnecessary purchases, this can quickly become a problem.
The last thing you want to do is rack up expensive credit card debt. Interest on credit cards is expensive, so carrying a balance on your card is not recommended. You should only charge your credit card what you can afford and then pay your balance in full each month.
The following tips can help you prevent your overspending:
Keep track of your expenses: Budgeting apps make it easy to set spending limits and monitor your spending. These tools can help you stay on track and become more aware of your financial situation, so you can change the way you manage your money.
Establish barriers to limit online shopping: For people with problems shopping online, making the checkout process more complicated can help limit shopping sprees. Consider deleting shopping apps from your phone and not saving your credit card details in your online shopping accounts.
pay cash: Credit cards are convenient, but if you’re struggling with overspending, you may want to keep your cards hidden in a safe place so you can avoid using them. By using cash to pay for your everyday purchases instead, you’ll have more control and a better idea of how much money you’re spending.
Invest in your well-being: It can be helpful to invest in products and services that allow you to relieve your stress in a healthy way, so you’re less tempted to overspend when you’re feeling depressed about life. Ideas include therapy sessions, a gym membership, or a hobby that helps you relax.
Keep these tips in mind to help keep your spending under control. If you’re looking to improve your finances in the new year, you can also check out our personal finance resources.
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We’re firm believers in the golden rule, which is why editorial opinions are solely ours and have not been previously reviewed, approved, or endorsed by the advertisers involved. Ascent does not cover all offers on the market. The editorial content of The Ascent is separate from The Motley Fool editorial content and is created by a separate analyst team. Natasha Gabriel has no positions in any stocks mentioned. The Motley Fool has a position in Intuit and recommends it. The Motley Fool has a disclosure policy.
27% of Americans ‘waste spending’ to deal with stress. If You’re Overspending Anxiety Here’s Why Originally published by The Motley Fool
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