If you’ve ever made a purchase and almost immediately felt a sense of regret, you were likely hit with a nasty wave of buyer’s remorse. And although it may not feel like it at the moment, buyer’s remorse is a collective experience that anyone can overcome with the right direction and tools.
The buyer’s remorse is a feeling of regret that tends to rear its ugly head after the purchase of a big-ticket item. These items are often things you have spent a lot of time contemplating purchasing before you actually set foot in a store or hop online to add it to your cart. Some of the more common big-ticket purchases that trigger buyer’s remorse include a new home, cars, and expensive electronics. On the other end of the spectrum, impulse purchases of any kind can bring on a strong feeling of regret. And although this feeling can happen at any time, there is still a lot to be said for major shopping events like Black Friday and Cyber Monday, which is designed to encourage shoppers to spend money they don’t have on things they don’t necessarily need.
Read more about 7 shopping tips for Black Friday.
The avoidance system is there to send a signal that there are risks and/or negative consequences involved in the purchase you are contemplating. Think of it as a behavioural function that tries its best to keep you from making regretful or poor decisions that will later have a negative impact on you.
As you may have guessed, the approach system is the complete opposite of the avoidance system. When this behavioural function shows up, it encourages you to do whatever will make you happy at that moment. It’s the gateway function to buyer’s remorse and spending habits filled with regret.
Now that you are aware of the frames of mind you may experience, it’s time to drill down to the core of buyer’s remorse, which is called cognitive dissonance. After purchase, you may experience an array of conflicting attitudes, beliefs or behaviours that are a direct result of cognitive dissonance. Let’s use the purchase of a new car as an example. While going through the motions of purchasing the vehicle you may be filled with excitement and a state of euphoria, but after you’ve signed on the dotted line, regret can set in and trigger a confusing range of emotions, including: Did I REALLY need this car?, Should I have bought the car at all?, I wonder if I have made the right choice? , Maybe the dealer lied to me, or maybe I have been fooled in some way?
As you can see, we almost immediately begin to spin the purchase in our mind to convince ourselves that we’ve made the wrong decision.
So, how does one navigate this cognitive battle of the mind? Let’s get down to the nitty-gritty of how you can avoid buyer’s remorse while acknowledging that your mind is a very powerful thing—but it can often be kept under control with a little practice and patience.
Here are 6 ways to help you avoid buyer’s remorse and regretful spending:
It sounds simple, but we often will skip doing the research before we make a purchase. There are a few factors that play into this narrative, one of which is the overwhelming amount of information that is available to us. The internet is a minefield for wrong and misleading information, but if you take the time to sift through the noise, you’re bound to find the details that will serve you well. Other ways of extracting those details include talking with friends and family who have purchased similar items or reaching out to your preferred online community to have them weigh in on the topic. From there, you can formulate your own opinion and begin to take steps towards an educated decision.
If you are purchasing without the proper funds in place, you are almost guaranteed to hit a wave of buyer’s remorse. There is nothing more regretful than making a purchase you either weren’t prepared for financially or didn't stop to think would impact you as you pull out your credit card. When you save up for an item of your desire, there is a great sense of reward that comes from? purchase. Free-and-clear purchases leave you feeling proud of yourself because you stopped to think about how that decision would impact you not only financially, but emotionally, too.
There is often an immediate rush to purchase a popular item, or more specifically, the latest and greatest in the tech world. Your best bet to avoid buyer’s remorse in this category is to wait it out. If you always run out and get the latest version of whatever phone or popular gadget, you will likely find yourself making the purchase again soon because you are stuck with fewer features and, thus, less bang for your buck.
It can be tough, but if you can learn to avoid the hype of a “good sale”, then you may find yourself lucky enough to avoid buyer’s remorse. Major shopping events like Black Friday, Cyber Monday, and Boxing Day are marketed to make you feel like you are getting a good deal, but the truth is that you could likely find that same deal (or better) during the rest of the year. Navigating big sales days requires research — and checking off all of the other tasks we outline in this list.
Regardless of the shopping day, the reason why you’re there, or the purchase itself — it’s imperative that you ask yourself why you are purchasing before you go through with it. It’s similar to asking yourself if the item in question is a want or a need. Dig deep and try to discover what drives you towards the purchase in the first place. If the answer is emotionally-driven or worse—you aren’t sure at all—it’s probably best to skip it until you have a more unambiguous indication as to why.
Making better decisions when it comes to your money begins with reflection, and the Wellspent app is the perfect place to start reflecting. When you review your transactions in Wellspent, we’ll ask you how you feel about the purchase and collect that information so we can serve it back to you in a few helpful ways. It’s then up to you to take those learnings and apply changes to the way you spend in the future. Mindful spending isn’t always easy, but we’re here to help you navigate it so you can improve spending habits in the future.
This article offers general information only and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or its affiliates.