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Have you ever walked into a store to buy mouthwash and come out with four bags full of splurges? You're not alone. Studies show that 1 out of 20 people can't control their urge to spend. Understanding advertiser's techniques, and your unconscious emotional responses to them, can help you buy objectively instead of emotionally. Spending can be divided into two simple categories, needs or wants. A "need" is something that is necessary for your survival, while a "want" is something that you think will make your life more fun or interesting. When reorganizing your costs, deciding which goods and services you can live without may enable you to survive a financial crisis. If you take time to analyze every cost, you can cut your expenses.

WHAT DO YOU REALLY NEED?

The essentials we need for life are shelter, food, utilities, transportation to work, and insurance. Everything else is a luxury, a "want." What can you eliminate? Does a family of four need a landline and four cell phones or can they survive on one phone? Twenty years ago most families had just one phone. Do they need four cars, or can someone use public transportation? Do they have to eat out or can they prepare inexpensive meals at home? Do they need a huge house or can they rent out a room? Do they have to use name brands or can they use store brands?

SALES TECHNIQUES MAKE YOU BUY

Most advertisers use the AIDA sales technique (Attention, Interest, Desire, Action), which is designed to make you buy their products even if you don't need them. They use key words that will grab your attention, peek your interest and trigger an emotional desire and response.

1. "Free-Discount-Sale" triggers your bargain hunter instinct.
2. "Testimonials-Guaranteed" gives you believable proof.
3. "You-Your" makes you feel important.
4. "Limited-New-Important" makes you feel successful or exclusive.
5. "Easy-Simple-Fast" requires you to value time more than money.

Marketing research done at Stanford University by professors Khan, Dhar and Huber state, "buying that first item opens the purchasing floodgates." They call this unconscious behavior "shopping momentum." You can, however, prevent this momentum by paying for your first item separately. This usually makes you think twice about buying more. Stores deliberately put momentum starters at the front of the store.

EMPOWER YOURSELF

Don't let advertisers convince you to buy products that you don't need. Overspending will not make you happy, satisfied and secure. In fact, quite often you will experience guilt and regret. Check your emotions at the door. Before you buy STOP, CLOSE YOUR EYES, AND THINK! Ask yourself the following questions.

1. Do I need this for survival?
2. Can I cut back to basic services?
3. Am I in control of my emotions?
4. Is this the last "sale" I will ever find?
5. Can I wait at least a day before purchasing this item?
6. If I save instead of buy, will my money grow and give me future security?

PRACTICAL STEPS TO CURB SPENDING

1. When shopping, make a list and stick to it.
2. Pay cash only. It's harder to part with.
3. Reduce temptations by staying out of malls.
4. Wait a least a day for most purchases.
5. Be aware of advertising triggers.
6. Comparison shop for the best value.
7. Develop other ways to handle your emotions like walking or reading.
8. Walk by the momentum starters in the front of the store.
9. Think about your future.

http://www.gsb.stanford .edu/NEWS/research/khan_shoppi ng.html
http://www.shopaholicsa nonymous.org
http://www.boughto utandspent.com/

Learn more about this author, Kathy Stemke.
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