The Psychology of Saving (and Spending)

A Twitter friend of mine, @DarryleP, shared this MSN Money article about the subtle tricks outlet malls play on customers to get them to buy by convincing them they're getting a steal.

That's interesting in its own right. I had my suspicions about those places. But the thing I found most relevant this week was this line: "MRIs of shoppers' brains have shown that spending triggers discomfort. Discounting helps alleviate that ..."

I know that feeling, all right. When faced with spending money, not so much on food but on anything that could be perceived as a luxury, I've got all kinds of discomfort lighting up my brain. Yes, this causes me to gravitate towards things that are significantly marked down, so I can feel good about the saving instead of feeling bad about the spending. That can make me vulnerable to false mark-downs like the ones described in the article.

But there's another bad thing about all that spending anxiety, which can also cost me money: I put off purchases of things I actually need or want very much, because I don't want to part with the money, and then I end up paying more for these things at the last minute.

For instance, right now the sandals I've been wearing all summer just broke. My instincts tell me to glue them back together (as I've done three times this summer already) and hobble along until the weather turns even cooler and I don't need sandals anymore until spring. That would postpone the emotional angst of getting out my credit card for a whole six months.

But that doesn't make sense, does it? Sandals are on clearance NOW. It would be much more frugal to "splurge" on new sandals now and have them all ready for those first warm days of spring.

In that spirit, I made a few "luxury" purchases my recent San Francisco trip that, in retrospect, were actually pretty sensible. I picked up these little items in Japantown:



New wallet. My old wallet was getting worn; notably the coin purse section was broken, meaning I never had pennies and dimes for those little tax-only totals at CVS. I paid $12.99 for this adorable and unusual wallet, which delighted me because, had I waited until I absolutely had to replace the old one, I would have ended up paying the same amount or more for a non-descript replacement from Kohls or the like. For a no-frills girl like me, it's a delight to have a workaday item like a wallet add some style to life.



Beautiful notecards. Before this shopping trip, I had actually told myself, if you see any nice cards for $1 or less, you should definitely buy them to keep on hand to avoid having to buy bland, tacky cards for $3 or more from the drugstore. Yet, when I saw this box of 16 cards for $12, I still had a hard time handing over my credit card. They seemed, just, too nice! But when you think about it, every time I avoid buying a conventional greeting card for $3 and use one of these 75-cent cards, I'm saving $2.25. Even if I use them as thank-you cards or invitations, the kind of thing you normally buy in a pack, the price is about the same for something that is much more expressive of who I am.


Bento boxes for Nutmeg's lunchesI bought two of these in different shapes for $1.50 each. I use them inside Nutmeg's lunch kit to hold sandwiches, vegetables, etc. They make it fun for me to pack Nutmeg's lunch, and they save me from using plastic bags, saving money and the earth. 

Now that I'm home, I'm very glad I made all these little purchases, even though at the time I felt like I was on an out-of-control spending rampage. I'm weird, right? This stuff was under $30 total.



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llorch826 said:

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I recently learned of a project that will help save thousands of Chicago's residents money on daily deals, that will feature local businesses from restaurants, museums, hair salons, and much more.

The Project is called Chitown Deals, and the website is figured I would help spread the word as they need a minimum amount of users before they can launch. Talks are apparently in the works with some of the most respected local establishments in the City and Suburbs, that are willing to give out major discounts (40 - 80 % off).

As an added bonus, a Loyalty Rewards Program is also being integrated. In a nutshell, this Program will allow consumers, to earn Points by using the site, and later redeem them for additional Coupon Savings. For Example, if you sign up today, and you use coupon code "CHI", you will receive 250 points (equivalent of a $5 additional coupon) just for signing up.

On top of this, they are integrating FREE printable Grocery Coupons to help Chicagoans save even more money. Just for signing up (which is absolutely FREE), you will have a chance to print some of the best Grocery Manufacturer Coupons the Internet has to offer.

Just thought I would spread the word so we can all start saving a little more!!!

Resweater said:


I think you are more than entitled to splurge! $30 is nothing. You work so hard to save your family so much money, and you deserve to treat yourself.

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