On average, 42% of us overspend online, later having to deal with the financial repercussions, according to a CouponFollow report. Many of us even use credit cards on such splurges, making the whole event even costlier, as not paying the full amount due will attract hefty interest rates. This may even lead to a vicious cycle of debt traps or worse, insolvency. We’ve already shared tips on how to get out of debt problems, but this article is focused more on proactive measures, rather than after-the-fact tips.
What makes this problem even worse is the fact that we might not have really needed, or wanted the product, but fell into the allure of clever marketing strategies by the giants in the eCommerce platform.
If you’re one of the people prone to overspending, or a young adult looking for ways to avoid such mistakes in the future, you’re in the perfect place. Here are EarlySalary’s top 5 tips to win the war against the online shopping impulse.
Make a Shopping List
In yesteryear times, making shopping lists for items that are required to be purchased from local, physical stores used to be a regular chore. However, with the ease of ordering online, the practice has slowly disappeared, ushering in an era of purchasing things that aren’t essentially necessary, nor affordable. Making a shopping list, before you visit the website (yes, website, you’ll understand the significance later) of your choice, can directly limit how much you spend on your shopping “trip”.
Sticking to what you need can be easier when you have a physical list to adhere to, and as a bonus, you will have a rough idea of how much you’re about to spend before you even visit the platform.
The 24 Hour Rule
The problem with splurges is the fact that they happen impulsively, without much thought put into whether or not it was necessary. While some of the impulses can be controlled by making a shopping list, you have to rely on these other tips when that fails. The 24-hour rule is simple. If you’re purchasing something online which is not on your shopping list or isn’t an emergency purchase, wait 24 hours before committing to the purchase.
This period of 24 hours will let you have enough time to go over your budget at least once and let you decide if this purchase is something you really want to make. More importantly, this thinking time will reduce the impulse part of the purchase and will help you make rational purchase decisions.
The Alt ID lifehack
One of the common reasons we get sucked into the whirlpool of online spendings is because of the thousands of offer emails/messages we receive on a daily basis. That being said, we can not really afford to sign up with a valid email id or phone number, as they are essential to help your track your purchase and ensure safe delivery.
The solution to this debacle is simple, sign up with an alternate email id and your secondary phone number. If you don’t have either, creating a new email id is free, and if you don’t have a secondary phone that you can use, try a spam filter that weeds out the offer messages that you get from the tech giants. As the often misquoted saying goes “what you don’t know, can’t hurt you”.
Uninstall, the mantra to success.
Another reason the whole process is impulsive is because of the instantaneous and intangible nature of online shopping. While going to a physical shop is the only way to tackle both of the problems at once, uninstalling the various shopping apps can go a long way.
Yes, granted, sometimes, these platforms do provide an app-only offer, but if you really think about it, these offers often accomplish in making you spend more than you set off to. If you do really want to/have to shop online, having the extra friction of searching from websites definitely helps. Also, adding to the previous tip, uninstalling apps will mean fewer offer notifications, stopping you from visiting the platform in the first place.
If you’re gonna do it, be clever
For most of us, the last time we overspent, isn’t gonna be the last time overall. We may lapse again, and it’s completely fine. While we may lapse again, it is prudent to set up measures and outs to reduce the negative impacts of overspending. Such measures include:
- Opting for cash in delivery (increases tangibility, and the negative response associated with parting ways with hard-earned money)
- Using Debit cards (not credit)
- Using EMI cards, or shopping loans that are cheap (like EarlySalary shopping loans)
While the last tip won’t necessarily help you prevent all of the negatives from an impulsive purchase, it will help you go into “damage-control” mode, and often help you get back to being rational before the purchase is completed.
Even if it isn’t the case, at least, you need not pay interest rates above 40%. The damage will be limited to the amount you spend, and cheap interest rates (as low as INR 9 a day), greatly reducing the impact of your impulse purchase.
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