How many of you engage in retail therapy? Do you even know exactly what that is and how it affects you and your money?

According to the Cambridge Dictionary,  retail therapy is defined as: “the act of buying special things for yourself in order to feel better when you are unhappy.”  It is reported that it gives one a sense of control when you feel out of control in your life.  It provides a sense of escaping, amusement, control, distraction,  and renewal to the one engaging in this practice.  In essence, it enhances one’s mood due to the dopamine, serotonin and endorphins ((a.k.a. “happy hormones”) it releases during the activity.  It alleviates boredom and impulsiveness.  But is this a good activity to engage in?

I guess it depends on how you engage in your retail therapy.  If you simply go window shopping or put things into an online cart without actually spending any money, it certainly won’t hurt you.  But, if you overspend your budget and don’t have enough to pay your bills, then it’s problematic.  When you use your credit cards without the ability to pay them off at the end of each month, that’s also an issue.  And, if you’re shopping online, research has proven that it’s not the same as paying with cold hard cash.  It’s easier to get into trouble financially.  I remember years ago people discussed how much they spent unknowingly on tv shopping channels.  Now, it’s expanded to online stores.  It’s also been reported that shopping addictions can result if this activity becomes a main method of coping with your stresses.

Moral of the story:

Does retail therapy have benefits?  Of course it does.  When you have enough discretionary income to allocate to retail therapy, it is harmless and therapeutic.  But, this activity has a huge downside that must be considered before going out and overspending on “stuff”.  Remember, the purchase you make today will be forgotten about tomorrow.  The credit card bills you incur when shopping and the everyday expenses you are unable to pay due to overspending, will remain.