Is Drunk Shopping Affecting Your Personal Finances?
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A fun night out drinking with friends is a good way to blow of steam and relax. But sometimes, all that drinking leads to stories of tripping down the sidewalk, leaving your ex a disgraceful amount of voicemails, to things you wished you’ve never remembered. Now a new study by Finder.com has shed some light on how alcohol also affects the things you buy when under the influence. Considering how hard it is to keep tabs on your finances, we take a look at how drunk shopping may affect your personal finances.
Shopping Under the Influence in Canada
According to the survey conducted by Finder.com, 1 in 3 Canadians have shopped under the influence in Canada. In fact, as seen in the study, drunk shopping accounts for 2.15 billion dollars in Canada. Of the people who have spent money while under the influence, men spent $256 while women spent $188 in their lifetime. These amounts can easily equal a month of groceries for some individuals.
Why Alcohol Can Affect Your Finances
Courage juice or liquid courage are names often used to define alcohol. The reason being, it gives you “courage” to do things you normally would not do. But alcohol doesn’t actually give you courage, rather it is a depressant that slows down brain functions, which numbs your senses and feelings of fear. This state of mind inhibits your ability to think straight thus allowing you to make decisions that in hindsight are poor, embarrassing, and sometimes detrimental.
One decision that people often regret is drunk shopping, as it typically leads to overspending. According to Adam Koos, a certified financial planner in Ohio, when you are inebriated, it’s easy to lose track of your spendings which increases your risk of spending more than what you have in your bank account and going into an overdraft. This devil may care behaviour alcohol brings on, can blow the money you’ve budgeted for your financial necessities, which can cause havoc on your personal finances. As a result, you may have to dip into your emergencies or take out a loan to make ends meet.
How Alcohol Can Affect Your Finances
Have you ever been asked what kind of drunk are you? Often you’ll hear your friends say that they are a happy drunk, sad drunk, funny drunk, angry drunk, or even a mean drunk. There is a reason behind this, according to alcohol.org, alcohol affects the cerebellum which has the ability to control functions like memory and emotions. This, in turn, can affect your emotions and reasoning when shopping while under the influence. During an alcohol buzz, you may decide that you deserve an expensive trip down south, even though your wallet can’t afford it. It’s only the next day when you’re sober that you feel the consequence of your actions. In fact, according to Finder.com, there are Canadians who purchased items that are likely to leave a serious dent in their finances like a car, a motorcycle, a trip, a flight, and furniture.
According to finder.com, shoes and clothes are the next most shopped items after alcohol and food. This makes sense as a report by Creditcard.com explains that consumers are more susceptible to sales and discount offers, as shopping under the influence reduces your ability to make sound decisions. Oftentimes, companies will reel you in with offers that require you to sign up for their credit card. In your drunken state, this may feel like nothing at all, but opening a retail credit card requires a credit check which will negatively impact your credit score. Moreover, this can be jarring to your credit score as the more debt you rack up the more it will affect your credit utilization ratio.
Leave Yourself Vulnerable to theft
Shopping drunk makes you more vulnerable to scams or clicking links that are not secure, which can install spyware into your phone or computer. This means your passwords and banking information can be stolen. Moreover, you may try to buy items on a website that is not secure which can leave your credit card information open to be stolen. Lastly, being drunk also causes people to be forgetful, making it easy to forget your phone and wallet behind at the shop, club, or on public transport.
How Retailers are Capitalizing on Your Drunken State
According to the Hustle, there are many retailers and online shops that are lying in wait to capitalize on your lowered inhibitions. It’s no coincidence that many of these retailers have late-night flash sales. For many, it’s a well-thought-out strategy to profit on your impulsive buying habits when you’re out drunk shopping.
Who is Shopping Under The Influence?
According to finder.com, on average, Generation Z spent $312, followed by Generation Y ($277), baby boomers ($235) and Generation X ($147). Interestingly, Generation Z men and Generation Y (Millenials) women spent the most under the influence ($503 and $356 respectively). In comparison to the other men across the generations, Generation Z is spending double than the rest. This is concerning as Generation Z, are at the age where they are just entering into the credit market. Meaning, they have access to credit cards but lack the experience to handle them responsibly. According to an article by Global News, young Canadians are more susceptible to credit debt and delinquency due to the “greater use of ease-of-access digital payments platforms”.
How To Limit Your Likelihood Of Shopping Under the Influence?
Carry Limited Cash – Limiting yourself with cash is a physical reminder of how much money you have. It not only can cause you to think before buying, but it is a physical way of stopping you from spending more than you have, as once there is no more cash on hand, you have no other way of spending money.
Uninstall Shopping Apps – Of course, with technology, there are many ways you can still buy if your credit card information is saved on any of your shopping apps. With many of these apps, purchases can be made with a single click of a button, giving your inebriated mind no time to even engage the thought of how this will affect your finances. As such, we recommend you don’t save your credit card information on such apps, or delete them altogether.
Digital Wallets – While digital wallets are a convenient piece of technology that has many advantages, it also gives you easier access to make non-essential purchases.
Have a “Designated” Friend Intervene – Just like a designated driver, have a friend you trust hold on to your card or watch over your purchases so that you don’t spend more than what you planned.
Reducing access to your credit cards can help reduce your ability to make impulsive purchases. Moreover, creating extra hurdles to make a purchase can hopefully give your brain enough time to think things through or at the very least cause you to give up as the process to make a purchase is too long or complicated in your inebriated state.
While drunk shopping may seem like a great time, it can also be harmful to your personal financial state. Implementing measures that will restrict your consumption while intoxicated will help avoid any unnecessary expenses surprises in the morning.
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Margaret Johnson is in the business of helping Canadians tackle their debt, deal with credit issues, and regain control of their finances.