Shortly after Stephen and I were married I became obsessed with buying a pasta maker. I ran out and got one -- top of the line. I was going to make delicious homemade pasta every night! Yeah, right, that didn’t last long. After it sat in the basement for 20 years, we finally gave it to a friend. And to this day, when I want to buy something expensive Stephen says “Is that going to be another pasta maker?”
Have you ever felt regret or guilt over a purchase?
Just like me and my pasta maker, I'm sure you have been there. You buy something on a whim, get home and regret it (sometimes even immediately). No one wants to feel bad after buying a big-ticket item. You should feel excited! But if you find yourself feeling down, you are experiencing buyer’s remorse.
What is buyer’s remorse?
Buyer's remorse is the feeling of regret after making a (typically expensive) purchase. This regret is often paired with stress and even panic.
In fact, buyer’s remorse can be considered a form of cognitive dissonance. You are battling between two different emotions and beliefs -- the need to avoid risks or consequences, and the desire to do what makes you happy.
Why do people feel buyer’s remorse?
- An item did not meet their expectations
- It was too much money, or they found a better deal
- They realized they did not actually need it
How to avoid buyer’s remorse:
1. Research before you buy
Did you do your due diligence on the item before you bought it? Research should be the cornerstone of your buying strategy. The more you know about a product before you buy it, the less likely you will regret the purchase. It's easy to go online and read independent reviews about cars, electronics, or anything with a higher price tag. You may find yourself more up-to-date than the salesperson. That's power.
2. Sleep on it
Instead of jumping online or running to the store right away, take a step back and wait. Time can be a helpful indicator when determining if something is bought on impulse, or if it’s an item that could really bring value to your life. Pick a predetermined amount of time (a day, a couple of days, a week, etc.). It should be as long as you need to get past any feelings of elation or excitement at the prospect of simply purchasing.
3. Align the purchase with your values
Buyer’s remorse can stem from the realization that what you have just purchased really isn’t needed. Ask yourself, “Is this purchase aligned with my values?” Taking the time to stop and ask yourself such a question requires brutal honesty. In the end, if the item is aligned with your values, you will feel much better about the purchase.
4. Make sure it fits within your budget
Remember, “You can have anything you want, not everything”. Are there budget item or categories you would be willing to reduce because of the purchase? For example: You want to take a long-awaited but expensive cruise. You might need to reduce your dining out budget for some time.
Everyone experiences buyer’s remorse from time to time. Thankfully, there are ways to prevent it. If you take some easy, careful measures before buying, it’s likely you won’t regret your purchase. In fact, you should feel great about it.
And if there’s a big purchase you’re still not sure about, we are here to help you make those decisions. Feel free to contact me at firstname.lastname@example.org.
Shari Greco Reiches
Shari co-founded Rappaport Reiches Capital Management with one goal - to maximize the return on life for her clients. Please connect with Shari below. She loves to talk about investing, financial planning, and Barry Manilow.
The author does not intend to provide investment, legal or tax advice as these materials are for general educational purposes only. Please consult your legal, tax or investment professional for advice on your particular situation. This material is derived from sources believed to be reliable, but its accuracy and the opinions based thereon are not guaranteed. It is not intended to be a solicitation, offer or recommendation to acquire or dispose of any investment or to engage in any other transaction. Investing involves risk including the possible loss of principal. Past performance does not guarantee future results. Please refer to RRCM’s Form ADV Part 2 for additional disclosures regarding RRCM and its practices.