Why you might feel the urge to overspend right now
After this year of no festivals, no plays, no shopping in stores without concern for a deadly virus – “no you can’t” is slowly transforming, with 60 percent of adults in the US now having at least one dose of the vaccine, to “yes you can.” Many of us, regardless of disposable income levels, will prepare for the powerful emotions about to swoop through our experience-deprived brains
Behavioral Economics
Our minds are not spreadsheets. Our decisions are a mishmash of feelings, reactions, and mental shortcuts whittled by evolution to keep us alive in the wild, within small tribes, without consideration for targeted Instagram ads for peep-toe espadrilles.
- As the pandemic shifts in the US, our thinking is about to get much blurrier
- One reigning factor that stands out as a determinant of how we behave is where we fall on the spectrum of cold state to hot state
- When emotions like fear or exhaustion take over
- Hot states are intense and powerful, and they exacerbate other biases
- They reduce us to something less like adults and more like toddlers
- A drunk person, for example, doesn’t consider the future repercussions of their actions
- Similarly, hot states exacerbate our present bias, which makes us overvalue what we have now and devalue what that stranger known as us in the future will have
Paulette Perhach writes about creativity, finances, tech, psychology, and anything else that inspires awe
She posts regularly at WelcomeToTheWritersLife.com.
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- Our mission is to empower through understanding. Financial contributions from our readers are a critical part of supporting our resource-intensive work.
Set aside some money
Set aside money until it is safe to spend without putting yourself in financial danger
- Unsubscribe from sale emails
- Turn off one-click pay
- Don’t save your credit card in your web browser
- Try to wait 24 hours before buying something unplanned
Find a photo that represents something you’re working toward getting a year to a few years out and make that your phone’s home screen or otherwise keeping it close
Remember, our spending is part of what will alleviate the Covid-19-inflicted financial suffering of our fellow humans
- Consumer spending constitutes about 70% of the GDP