Psychologists have recently begun to study the emotions that people experience when parting with their money. Psychologists use the term “pain of paying” to describe the stress and anxiety people feel when spending money. Those who feel too little pain of paying are called ‘spendthrifts’ while those who feel too much pain of paying are referred to as ‘tightwads’. Researchers at BeyondThePurchase.Org were interested in comparing the spending habits of spendthrifts and tightwads to learn more about how their financial behaviors affect their happiness. They wondered if the pain of paying was related to materialistic and experiential purchasing tendencies, because research has shown that happiness is increased more when spending money on experiences, as opposed to material items.
Visitors to the website BeyondThePurchase.org were asked to complete the Tightwad/Spendthrift Scale, the Experiential Buying Tendency Scale, and the Materialistic Values Scale. The results of the study indicated that spendthrifts were more likely to have materialistic values, while tightwads were more likely to purchase experiences. These results suggest that people who are tight with money may be more hesitant to make purchases, but when they do spend money, they do so in ways that will make them happy. On the other hand, those who spend freely may feel better in the moment, but their purchases may fail to bring them lasting satisfaction.
So before shelling out that hard earned cash this holiday season, it may be wise to pay attention to how you feel when making your purchases. That little warning voice in your head may be steering you toward purchases that will make you and those you care about happier. In a world where our consumption decisions are increasingly driven less by necessity and more by psychology, it is important to know your spending habits and values.