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What Does Your Financial Behavior Say About You?


I’ve mentioned this before, but one of my favorite parts of grad school was learning about human behavior. All people think, behave, and react in very predictable ways, no matter how much we try to convince ourselves of our uniqueness.

As a therapist, it’s awesome to say things like, “Let me guess – she said X and you reacted by doing Y,” and get The Look of Amazement. The one that says, Wow! How did you know? You must really understand where I’m coming from! And while I love astounding people with my magical therapist powers, it’s actually very simple to figure out how a person will behave in a given situation once you know him or her.

All behavior serves one of two purposes: (1) to get something, or (2) to avoid something. That is the single most important sentence I learned during my education. And it’s the one I finally applied to my own life to figure out what the heck I was doing financially.

Some people will read that statement and immediately start looking for loopholes. Go ahead – it’s not possible. No matter what you do, you are gaining some kind of benefit; otherwise you wouldn’t do it. People aren’t big on doing things for no reason, even though some of their actions may seem random. Understanding the motivators behind your financial behavior is the first step in figuring out where your money goes and how to hold on to it.

Spending to Get Something

Obviously when you spend money, you get something. Groceries, a pair of shoes, a car… But that’s not what I’m talking about. What are you really getting out of trading your hard-earned cash for goods or services?

Acceptance. Many people buy things in order to fit in with their friends, family, or coworkers. If that wasn’t true, things like Ugg boots, sushi, and Avril Lavigne wouldn’t exist. (And what a fabulous world that would be!) It’s human nature to want to fit in, but sometimes we pick strange ways of doing it.

Happiness. Whoever said money doesn’t buy happiness was a damn liar. I know money ALONE can’t give you lifelong happiness, but it sure helps sometimes. I won’t pretend I don’t get a level of joy from things like my beloved iPhone, my dogs, and my enormous collection of books. All of those things cost money, and all of them are worth it to me. They won’t keep me happy forever if everything else goes to shit, but they’re a nice start.

Escape. Why do people drink or use drugs? Because they want to escape from everyday life. Same goes for any other addiction – sex, gambling, food, overspending, etc. For me, spending money was definitely an escape from other stuff in my life. Unfortunately, all the stress was waiting for me when I came down from my “high.”

Convenience. This one is HUGE for me. If I think I can save time and energy by purchasing a product, I’m all over it. If someone ever invents a device that allows me to shower, eat breakfast, and check email at the same time, I’m in trouble. But the problem with convenience is its price tag – sure, it’s easier, but your wallet will feel the difference even if you don’t.

Spending to Avoid Something

I think it’s much easier for people to think about what their behaviors get them than what their behaviors help them avoid. We’re conditioned to face things head on and deal with them, but how many of us do that 100% of the time? No one I know.

Reality. This fits in with escaping, as I mentioned above. TV, video games, movies, books, and gadgets all help us avoid whatever is stressing us out. Sometimes so much that we lose track of what’s really going on outside whatever screen we’re staring at. I’ve definitely been guilty of buying new gizmos when facing a difficult decision, like that helps anything. I also loved going out to eat when something stressful happened, like when I lost my job in 2008.

Consequences. Have you ever broken something and rushed to buy a new one before anyone noticed? What about replacing your kid’s dead goldfish before they get home from school? My personal favorite: going into more debt to avoid facing your debt. You know what I mean – bill collectors are calling, so you use a credit card to pay off whatever you owe. Or you take out a debt consolidation loan, the dumbest invention in history (unless you’re the lender who collects all the interest).

Discomfort. There’s a reason why Tempur-Pedic sells a bazillion mattresses a year and we see luxury cars all over the roads when society is broke. We justify purchases all the time because we want to be comfortable. Sometimes it makes sense – I’m not going to walk around shivering in my house to save $30 on my heating bill – but other times we are avoiding something that isn’t THAT big of a deal. Like the time I bought a fur coat before a winter trip to Chicago. It was on sale, but that’s beside the point. I was so scared of being cold I spent money unnecessarily. And I haven’t worn the coat since.

Responsibility. We’ve all heard of the midlife crisis. There’s also the concept of the quarterlife crisis – when we’re out on our own for the first time and feel the need to buy everything on the planet. In either case, people tend to go through moments when they want to be young again. But why don’t you ever see some 50 year-old man buying a skateboard or a bicycle? For some reason, when we remember our youth, we see it in terms of all the stuff we had instead of the memories we created. And all that stuff doesn’t make us feel young – it makes us feel old and bitter when we open the credit card statements.

What About You?

Think about your miscellaneous purchases for a minute. Not things like bills and groceries, but the things you buy that you didn’t necessarily need. What were you gaining or avoiding by making those purchases? I gave a few examples, but there are countless motivators that might apply to you. How can you use that knowledge to get your spending under control and meet your financial goals?

About Andrea Whitmer

Andrea is a freelance web developer and mom trying to maintain a sense of humor in an otherwise chaotic world. She blogs in hopes of helping others avoid the same mistakes she made in the past. Join in the discussion here on So Over This, or connect on Twitter, Pinterest, Instagram, or Google Plus. You can also subscribe to new posts via RSS so you never miss out!


  1. My biggest bad spending habit would probably fall under your avoiding reality category.  My husband and I spend so much money on going out to dinner, and it is almost always my doing.  We go out to celebrate small victories, but I also drag us out whenever I have a bad day at work or something else is stressful.  Of course now that we started a budget at the beginning of this month that hasn't happened, so hopefully I can deal more with reality in a positive way, like exercising, instead of going out for dinner or cocktails all the time.

    • Maybe you could start small – instead of going out for dinner, eat at home, then go out for dessert. That's a heck of a lot cheaper! Eventually you could wean yourself off dessert and just go out for a fountain drink or something. Of course exercise is also a good idea, but I can't endorse something I personally refuse to do. 😉

  2. 444express says:

    I must be doing pretty well because I think I've gotten my miscellaneous purchases down close to zero.  I bought a $30 coat recently even though I had several others (all of the others had problems or looked dowdy) but it was only $30 (and I admit I bought it so I can look sharp on the extreme few occasions I'm seen publicly at night and that's to see my husband's band perform, or maybe when I go to the bank to negotiate lower terms on a loan and I want to look less than destitute – I bought it for my own perceived social status, in other words), and I bought a lipstick for $6 because the previous one had to be dug out with a fingernail, but aside from the occasional (and I mean VERY occasional) pair of shoes that I'm sure to snag for the $10-$30 price range, I'm totally focused on paying off debt because it makes me happier than any purchase.

    • I think shoes and lipstick are totally necessary. Seriously. 

      I was pumped about paying off debt until I ran out of credit cards to pay off. My car loan is so overwhelming; I feel like I'll never get done paying it. Hopefully when something calms down for me financially I can get back on track and love debt payoff again!

  3. Geez. Books = Escape. I have a t-shirt that says, "Who needs drugs? I go broke buying books." I was wearing that t-shirt while I was at one of my favorite local booksellers and making a triple digit purchase for some books I'd been salivating over for a few weeks. As soon as I had the money and I knew I could get away with taking my lunch for the next week, BAM. New books.

    I mean, I could justify it. Isn't that what we do? We spend emotionally and then use our intellect to explain it away as necessary? Had I been honest with myself at the time I'd realize that I'd bought those books a week ago and I still have barely been able to look at the first one because of how busy my school schedule has been. I can't display them because their subject matter is objectionable to certain members of my family, (I live in a home where we don't speak of religion due to the debate it causes so I hide all my books on religion so it won't cause an issue) and while I am still happy I have them, I probably would have enjoyed the food I could have bought instead of the sandwiches I've been packing to make up for the difference.

    I think one of the scariest and easiest things to spend money on is eBooks and Audiobooks. It takes me near an hour to get to and from everyday and I've been loving getting a good audiobook to make that time fly. But audiobooks, while available from the library, aren't always in the order you want or ready when you are. So that makes sites like Audible, which you don't even have to plug your smart device up to a computer to use, very, very tempting.

    • I'm with you. I could spend a million dollars on books very easily. I've gotten better about slowing down and making sure I don't have any unread books before I buy new ones, but I love them SO MUCH. The Kindle app for iPhone/iPad is the worst invention ever – it makes it way too easy.

  4. "All behavior serves one of two purposes: (1) to get something, or (2) to avoid something." – Some evolutionary psychologists suggest the only reason men do something is for sex.  That would mean #2 is superfluous!

    Joking (or am I?).  Money's not everything but it's impossible to live without it.  It's a tool to facilitate trade.  When we spend money on something we better believe it makes us better off – whether we believe it will make us happier or just fulfill some other unfulfilled need.

  5. Miss T @ Prairie Eco says:

    While I am not in debt I think some would classify my spending as emotional. I find that depending on what is going on I find the need to shop. I don't actually need the item but I feel like I do. I know this isn't good so I am working on it. 

    • I'm horrible about emotional spending. I've tried to wean myself off expensive stuff – now I usually buy a magazine or a $3 nail polish instead. It's harm reduction – I haven't conquered stress shopping yet, so at least I can spend less when I'm doing it. 🙂

  6. I think a lot of mine are for the 'happiness' factor. (Darn you, $1 candles). But they allow me a few moments of peace and quiet, and that is very high priced these days. How can I use that knowledge to keep my budget under control? Stretch the line to where needs meet wants. If that doesnt work, then maybe set aside a small portion (like a few dollars a month) to save up for these wants, and that way, you know you can get it, just maybe not right now. The key is not to feel deprived, because that only leads to overspending.
    PS: Congrats on getting to the front page of MSN! I thought I recognized that writing from somewhere.

    • Until I saw this comment, I didn't really know what happened. I just knew my email started exploding with hate mail! Glad the rush seems to be over now.

      The best thing I ever did was setting up wishlists and savings goals. It was much easier to control myself when I was seeing progress toward something I wanted instead of just buying it impulsively. 

      • Oh! You were featured on MSN!? AWESOME!!!!

      • Subhorup Dasgupta says:

        The MSN page showed up for a while on the hot pages list on the Alexa toolbar too.

        I love books, and music, and have always apportioned more than I should on my budget. A worsening crunch over the last two years compelled me to reconsider, and thanks to libraries, friends, and used book stores, I have had just as rich a reading life as ever, with hardly any spend!! Music podcasts have helped me cut back on buying DVDs while discovering a wealth of new music and artists.

  7. My husband and I have paid off $40k in credit card debt in the past 10 months, and although I am so proud of us (just $11k to go), I know that I could be reducing it even more if it weren't for my unnecessary spending. My weakness now, since I know I'm not supposed to be shopping for myself, is buying gifts for others!! It's so easy for me to justify it in my head if I know it's for someone else!

    • First of all, congrats on paying off A TON of debt! I'm so jealous!

      Second, I know exactly what you're talking about because I did the same thing when I first decided to stop spending. I wouldn't buy anything for myself, but I was buying stuff for other people left and right! I even bought sweaters and birthday gifts for my dogs. Sad!

      Thanks so much for visiting and commenting. 🙂

      • Thanks for the kind words… For whatever it's worth, I just want to mention that the only reason we were able to accomplish this is that I have amazing parents. We made the decision to sell our house – mortgage payments are tough – and move into my parent's basement. I know not everyone is lucky enough to have this option available, but I also know not everyone is willing to make this sacrifice even it the option is available. I guess my point is, we have to make tough choices to reach out financial goals, but for those who do it will eventually pay off!!

  8. Doctor Stock says:

    That's a refreshing way to view this topic… very interesting. I tend to love my iPhone too… I can hardly believe i lived without it!

  9. I am not a big spender, but when I do spend it is usually a bigger ticket item and I feel happy about it.  Is it always the best decision/purchase?  Nope!  But at the moment I am happy and since I am pretty much a hoarder of my money anyway it doesn't hurt too bad to overspend now and then. 

  10. Beuatifully said!! Fortunately I'm not in the habit of spending money to "escape" (I eat chocolate and fried food for escape!) but I definitely spend for the sake of convenience.

  11. I'd put sushi in the happiness category – I love it! 🙂

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