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The "keep up with the Joneses" mentality held by the post-baby boomer generation has led to a society of over-consumption which has resulted in a dependence on credit cards, mounting debt and individuals increasingly “in the red”. What was once a nation of thrifty savers after the Great Depression has since given way to many individuals living lavishly, oftentimes beyond their means. In fact, over the course of the last decade, the average family's income grew by 9 percent while credit card debt has increased 81 percent, student loan debt has increased by 137 percent and mortgage debt has jumped 154 percent. While many of these “shopaholic habits’ can be attributed to generational ideas, the habits are also due to a variety of other factors, such as the ease of online shopping, the increasing cost of living and cultural pressures. Shopping continues to burn a hole in American's wallets through use of the Internet and the ease of online shopping, and according to a study at Stanford University, in 2002 there were an estimated 60 million Americans “addicted” to shopping. Consumer pressures are definitely greater in the current day, especially with increased dollars spent on advertising by companies wanting to sell their product. What is it about shopping that people cannot resist? Maybe it's the non-stop advertisements on television, billboards, and radios, or possibly that in the comfort of your own home shopping can be done online 24 hours a day or by catalog. Or it could be that credit is easy to secure - almost anything can be bought on credit, regardless of one’s ability to pay. But experts say that shopping, like our favorite comfort foods, lifts up our spirits when we are lonely, depressed, or angry. Many of us shop and buy in order to make us feel better about ourselves – a phenomenon called “emotional spending.” This stems from Maslow’s Hierarchy of Needs – who hypothesized that humans are motivated to do things to achieve physiological needs first, and then on their needs to fit in and feel belongingness. We buy items to gain self-esteem, because so much emphasis these days is placed on owning material things. Our status in this world seems to be associated with how big our house is and how nice our cars and clothes are, so if we can keep up with those around us then we feel our self-esteem rise. Advertisers take full advantage of these thoughts and exploit this need to “fit in” through using sexually attractive models or famous people - tricking us into thinking we could look and feel like that person does if we buy that product. We are compulsive spenders – especially when it comes to a good sale or promotional credit card. Consumers are offered 10-20 percent off for signing up for the store credit cards and permanent sales racks can now be found in just about any store. Although finding a bargain may be considered smart shopping, three-quarters of Americans have purchased something they didn't need at the time just because the price was right. Items we purchase often hang in the closet only to be worn once, and then the item becomes out of style and off to Goodwill. They don’t have Shopaholic Anonymous meetings so you will have to learn to curb your spending on your own. It won’t be cured over night, but being conscious of the issue will be a step in the right direction. Debt-Free America offers the following guidelines to cure your shopaholicism: Be Aware Of the Underlying Compulsion To Shop Understand why you shop, or your emotional spending habits. Start by thinking about your last few shopping trips the mall. Did you buy a bunch of things you’ve only worn once or twice? Or did you actually go to the mall with a mission, buy that one item, and be on your way? Are you an impulsive buyer, or do you think purchases through? Think Before You Buy Now that you’re more aware of your spending habits, it will be a little easier to be aware of your impulse buying and emotional spending. From now on, when you see an item you think you’d like to purchase, take a moment to consider whether it is a need or a want. Do you NEED the $100 pair of black shoes for work, or do you WANT them? The answer is that you want them. And while you may need to own a pair of black shoes for work, it is almost certain there is another place you can purchase them for $50, instead of $100. Outline Your Financial Goals & Evaluate Regularly List your financial goals; short term and long term. Do this often and make changes as necessary or as you accomplish one of the goals. By setting goals for yourself you can more easily cut back your spending, because you have something more important to strive for. If you want that new car by the date you’d set for yourself you can’t have that sundress you’re eyeing at Nordstrom’s. And keep track of how close you’re getting. When you avert the $100 expenditure, put the $100 in your savings and mark it down on your goal sheet. You can see that you are that much closer to your goal, and you will feel more satisfied that you didn’t buy the dress. Think Long Term Consider the long-term benefits of possibly investing this money instead. For example, rather than spend $79 an item each month on average, invest the money in a savings vehicle that yields an 8 percent return. In a years time you would have invested $1,069; five years $5,922. Avoid The Spending Culprit Avoid stores (or the internet) where you overspend. If you must make a purchase, make sure you buy the item you intended to shop for and not any additional items. Bring a friend along or someone who can keep you focused and limits your spending tendencies. You can also invite a friend to help cure his or her shopaholicism along with you. It’s easier to fight bad habits with a buddy! Substitutions Substitute your shopping inclination with a healthier behavior. Find something that puts distance between you and the stores, take a walk, find a new hobby, exercise or volunteer. Reward Yourself Don't be afraid to reward yourself for taking control of your spending. We all deserve a reward occasionally but remember to be reasonable and think of how far you have come. WHAT: The Shopaholic Phenomenon: How To Avoid the Spending Black Hole WHO: Debt-Free America - Nationwide non-profit community service organization - Offers confidential and professional credit counseling and debt management programs WHEN: Interviews are available immediately and ongoing WHERE: In-studio or phone interviews with local Debt-Free America counselors Debt-Free America is a 501(c)3 non-profit, community service organization offering confidential and professional credit counseling, debt management programs, and financial education to consumers nationwide. Debt-Free America is dedicated to providing FREE services to help financially distressed families and individuals effectively manage their personal finances. The Board members and operations staff have a long-term commitment to helping anyone in debt crisis, and even those not in a debt crisis. Debt-Free America has been in the business since 1997 and is now serving over 16,000 clients nationwide.
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