Sunday, December 12, 2010

Why you should avoid emotional spending

Laughter isn’t just the best medicine health wise; it can also do wonders for your finances. Experts suggest putting off making financial decisions until you are in an upbeat frame of mind.When you are feeling positive you are better able to make suitable choices, and to find more innovative solutions to problems.

Good moods lead to smarter shopping. This is because good moods promote optimism, creativity and generosity. When all these emotions come together it’s a fertile time for decision making.

Daphomine, an internal brain chemical, becomes more available when you are happy and also stimulates
sections of the brain responsible for memory and thinking.

People who feel sad not only shop more but they are willing to spend more for the things they buy.
Shopping has always been used as a distraction. People spend money and go on shopping binges to
escape their feelings.

Many of us can admit to emotional shopping at one point or another. You find yourself making
unnecessary purchases after a tiff with a friend or as a means to boost your self-esteem.

I used to “treat” myself to something special before a big exam. I figured even if I didn’t do great I’d at least have something nice to cheer me up, and if I did do well then it was a reward.Unfortunately, my bank accounts wasn’t looking too happy.

However, on the other hand, you also want to postpone making decisions if you are extra confident or highly adventurous. Researchers found that overconfident people sold stock too often, resulting in poor earning than other investors.

Bottom line you will have to pay for your emotional spending. A happy shopper is a smarter shopper.

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