When it rains in Windhoek, it’s usually on a week day just before 5pm. When I didn’t drive to work, rainy days were my worst days. On those days, it was survival of the fittest getting a taxi back home. It was frustrating. So I came up with a plan: Buy a cheap used car. For someone that just got out of school, I sure could not afford a decent one. I was determined to pour my (very) little savings into whatever they can buy with wheels and a roof.
Emotional spending decisions are usually not well thought out. So their effects are not always favourable. The idea of an emergency scrap car is really funny now that the rain has stopped, although I don’t think it would be, had I actually went through with the plan. The following suggestions can help prevent you from getting into financial situations of emotional spending:
- Think about your bigger financial picture. This will require you to have some financial goals and a budget as guidance. For your financial goals to work, they need to be aligned with your life goals. Is whatever you want to buy part of your plan?
- Will I need whatever I’m about to buy tomorrow, or anytime in the future? From experience, in the exact moment when my emotions are the ones holding the steering wheel, the answer to this question is always yes. There’s always a little voice that tells the truth though, and you should listen. DO YOU REALLY NEED IT?
- Get out of the shop. Delay and take time out to see if you really want or need the item. If that pair of shoes is unforgettable, then you can always go back.
- How will it affect your life? Can you afford the financial changes of your decision? If you were to buy that car, do you have parking space? If don’t, you’ll have to get one. Are you able to afford petrol, repairs and insurance for the car?
We live in a world with so many problems that we might as well just camp at the mall if we are using spending to cure our emotional chaos. We are not able to control everything that happens to us in life, but we can control our reactions. Your emotions do not have control of your money; you do. So act like it.
This spoke to me. Financial wisdom is key. Great piece, Hendrina!
Thanks Mbili. I’m glad the lesson had an impact :).
110% relatable. Even though they teach us about the cost vs benefit concept in school, we often fail to apply it in our own lives and i guess it’s partly our feelings that blind us from doing so…This should be published in The Namibian newspaper, could save a lot of people from making such bad comitments…
Thank you! Personal finance can be a bit hectic. We get blinded by our feelings and tend to forget about our goals. I’m glad you relate. As for The Namibian 🙂