Spending money is unavoidable and leading a balanced life is important but many people still feel guilty about spending. If you are saving a healthy amount of your hard-earned money, then you shouldn’t feel guilty about spending money on something you enjoy.
Guilt has evolved as a form of self-regulation, protecting us from negative social consequences and promoting social cohesion. It also protects us from internal self-inflicted punishment and interestingly, guilt can be such a powerful force that people can physically feel the weight of it.
However, in a modern-day environment guilt can arise in situations that aren’t particularly beneficial. For example, we are constantly faced with constantly being encouraged and manipulated by marketers to spend our money. Therefore it’s not entirely our fault when we overspend or make purchases we later regret.
On the other hand, it’s important to buy things we need and that make us happy. Therefore, I wanted to look into the psychological causes of guilt and how you can overcome your money brain to enjoy like a little more:
- Understanding That Guilt Is A Natural Impulse
- Overcoming Your Basic Instincts Around Feeling Guilty About Money
- Finding Psychological Congruence Between Your Thoughts & Behaviours
- Learned Beliefs & Money Scripts
- Challenging Your Learned Feelings About Money
Where In the Brain Does Guilt Come From?
There is a part of the brain called the ventromedialprefrontal cortex (vmPFC). The vmPFC is part of a wider emotional regulatory system involving areas of the brain related to emotion, such as the anterior cingular cortex and the amygdala.
It is thought to have an inhibitory function on the areas of the brain which are activated by emotionally arousing stimuli. The vmPFC has been shown to be compromised in psychopaths. Providing insight into why they have characteristically abnormal emotional processing, such as lack of guilt. This probably explains why Psychopaths make up between 15 and 25 percent of the male North American prison population
How Does This Relate To Feeling Guilty About Spending?
The vmPFC is also thought to be involved in processing information about the relative “economic” value of options, predicting a role for this region in value-based decision making. For example, the assessment of potential gains and losses we might incur.
People suffering damage to the vmPFC often show poorjudgment and high impulsiveness and tend to block out the negative consequences of their decisions. It has therefore been postulated that compulsive buyers should have lower activity of the vmPFC.
Self-Representation & Material Possession
The vmPFC has been demonstrated to be associated with the construction, stabilization, and modification of self-representation, and ultimately in guiding our choices and decisions.Put simply this region of the brain is often activated when people contemplate aspects of themselves and their lives, such as possessions.
The vmPFC is theorized to be engaged in the valuation process and subjective valuation of different types of rewards.Therefore, when we consider spending it’s likely that the vmPFC will be activated to some extent.
Why Do You Feel Guilty About Spending Money?
Buyer’s remorse is the sense of regret after making a purchase. I personally tend to experience this, more for smaller impulsive purchases than big-ticket items. Especially when the purchase in question, does not live up to expectations.
Buyer’s remorse can trigger feelings of anger, disappointment, and regret. It can be influenced by a range of factors such as unchangeability. This is why people often regret buying a car, an expensive meal or drinks out?
These items are difficult or impossible to take back, however, being able to change your mind after a decision or purchase can actually lead to less satisfaction. This is the reason retailers are often very flexible with their returns policy in order to make you feel you have decision freedom. People therefore happily pay a premium price with peace of mind, knowing they can undo a decision.
In fact, there are many tricks that marketers and retailers use to encourage you to buy their products. There has been a significant amount of time and money invested in consumer psychology and how to make you buy things you don’t really need.
The Psychology Mismatch That Makes You Feel Guilty About Spending
Cognitive dissonance is the mental discomfort or psychological stress experienced by a person who holds two or more contradictory beliefs, ideas of values. For example “I believe I should be good and save money” vs “I believe I should treat myself to this product I want”.
In the context of guilt and spending, we are talking about post-decision dissonance. This can arise when a person must make a difficult decision and is heavily invested between the alternatives of saving vs spending.
Consequently, people feel guilty about spending because they fear the money could be going towards something else. (e.g. their savings). Factors influencing this are resources invested, the involvement of the purchaser and how compatible this is with the purchase.
Living In A World With Too Much Choice
Post-purchase dissonance may also be influenced by the paradox of choice. The paradox of choice is the concept that having too many options can impede well-being.
Too many choices can actually result in dissatisfaction and unhappiness. The paradox of choice is something I’ve covered in a previous post on how to save money without suffering.
This can exacerbate the post-decision dissonance we have already discussed. With this in mind, I would argue that minimalism is an effective way to combat this problem. As is accepting that you cannot have or control all possible outcomes when it comes to a decision or purchase.
Money Scripts & Learned Beliefs About Money
Our beliefs about money have been shown to influence mental health in a number of ways. They can have an impact on depression, self-esteem, self-worth, happiness, in addition to money disorders. @DrBradKlontz would argue there are four key money scripts:
- Money Avoiders believe that money is bad, rich people are greedy, and that they don’t deserve money.
- Money Worshipers are convinced that more money will solve all of their problems, there will never be enough money, and that money brings power and happiness
- Money Status scripts equate self-worth to net worth and put a premium on buying the newest and best things.
- Money Vigilantscripts include themes of frugality, the importance of saving, being discreet about how much money one has or makes, and nervousness about making sure money is saved in case of an emergency.
These are ‘typically unconscious’ behaviors rooted in childhood learnings, often passed down from generation to generation.However, these are often just partial truths but despite this they have a big impact on our financial outcomes. I unknowingly touched on this during the post I wrote on why financial independence is a worthy goal. In this post, I said:
“Many people, including myself, are brought up with the mindset that you save money to spend it. At an unsustainable rate. For example, if I save £2,000 this should be spent on something tangible like a car. This is usually something that depreciates in value or even has no intrinsic value at all like. By contrast, the FI mindset is to save, invest, accrue money so that it can be withdrawn at a sustainable rate thus never being depleted.”
How Can You Influence These To Stop Feeling Guilty About Spending?
Often the reason we’re feeling guilty about spending money — or not — is a direct result of our money scripts. The research suggests that once we begin to identify and challenge these beliefs, we can reform them. Perhaps this provides more insight into the ‘Money Vigilant’ and the ‘Money Worshipers’.
For example, if you are constantly seeking to improve your net worth and never satisfied you may find it is extremely difficult to spend any money at all. By contrast, the ‘Money Status’ individuals may spend money in order to buy the new and best things but regret once this initial buzz wears off the purchase.
How To Overcome Your Money Brain To Stop Feeling Guilty About Spending Money
Forward planning and making decisions ahead of time will likely reduce the demand in this region of the brain. This is because it will reduce activity in the emotion producing regions of the brain, consequently requiring counter activity in the vmPFC. If you know you are going to have to spend, take the emotion out of the situation. Here are some examples:
- Stay away from compulsive and instinctive behaviours. I often find it’s easier just to say no rather than try and calculate which is the most cost-efficient option.
- I also find that sometimes meals with a set menu deliver greater satisfaction due to the set price. Here are some of my favourite options, if you are in West Yorkshire, England:
- Estabulo Rodizioall you can eat meat & salad bar for £15.95 lunch.
- Kendalls Bistro 3 courses and a half bottle of wine for £30.
- Blue Sakura all you can eat Japanese for £18 at lunch.
- Practice self-discipline and learn how to improve your willpower. Grow the muscle of self-control.
- Make sure your spending decisions are aligned with your self-perception and only spend on things you value.
- Set a specific budget for things you know you will want to spend on (e.g. £100 a month of eating out).
- Use a money app such as Monese to set a budget and track your spending. This will help you to become more spend and save more conciously. You can even dedicate pots of money to specific goals or categories.
Final Thoughts On Feeling Guilty About Spending
Feeling guilty about spending money is natural. Many consumers experience feelings such as buyer’s remorse. This is due to both our neurobiology and our experience of the world. However, you can influence the mechanisms that influence our feelings about spending and saving.
Feelings such as buyer’s remorse is that it’s less likely to occur after an experiential purchase than a materialistic one.Perhaps this is why I have no regrets for spending vast sums on my travel experiences. In fact, there’s a whole area of psychology around how you can buy happiness.
Aligning your beleifs with your behavour is an important first step. In an ideal world, I want to save as much as possible. However, realistically I know it’s not possible to save 100% of my income. One way I find can resolve this dissonance is by setting a savings target of 25-30% of my income. This way, when I end up spending large amounts on my travel experiences, I’m comfortable knowing that I will still achieve my overall financial plan.
I hope this article has put a spotlight on some of these factors. If you are someone who experiences guilt or similar emotions when spending, I would love to hear from you. Likewise, if you don’t, what is your secret, is this natural or something you practice?
This is really good content. I’m glad frugality is in my “DNA” and I don’t experience this kind of guilt much, but it’s a horrible feeling. If I had had an all-you can eat sushi around where I was living in England though, the story could have been different hehe 😀
Thank you, that means a lot!
Ha ha, yes it would! Saying that, you are based out in Portugal/Lisbon aren’t you?
Imagine you will have your own temptations! Best seafood I’ve ever had has been from there.
Yes, I am, at least in this moment in time. To be totally honest I prefer a bifana (the cheapest thing you can find), maybe because most nice seafood (here) is associated with high status people and poshness. It’s funny how values and mental images shape consumption.
Ooh, just checked bifana out. They look good!
Interesting. High status and poshness puts me off too! It’s not at all required for great food either! In fact, some of the best food I’ve had has been in the most humble places.
I’ve spent some time down in Lagos mostly. So my experience is probably different from the city cuisine.
There it was very simple, inexpensive but delicious food. Tuna steak, swordfish, seabass etc. For around €10-15 a main.
That was a very good deal 😉
Really interesting. I’m making a conscious effort to think about money as I suppose I have always been a bit of a money avoider – although reading about the different scripts, I think mine are mixed. You’ve given me food for thought to work on. Great to read a blog about money that is accessible to those of us who are not naturally ‘money minded’. Thank you!
That’s interesting. Do you think that’s due to how your parents perceived money also, or more to do with your unique interactions with the world?
Yes fair point. I guess that is the problem with specific segments, people are perhaps to complex to just fit into one or the other.
I’m glad you think so, I wanted to take something academic and turn it into something accessible everyone can engage with!
Thanks for responding.
In our household money was kind of a taboo subject to be talked about in hushed whispers! I went on to get a high-earning job and kind of took money for-granted (I’ve made huge mistakes regarding spending it!), saying ‘it wasn’t important to me’ (ha!). I was taught that there is never enough money, that it can solve all your problems, that you have to save money… Perhaps I even felt a bit ashamed/embaressed about having money – and that I wasn’t worthy of having it.
Such conflicting messages that I pretty much avoided thinking about it in-depth. I’d really like now though to develop a healthier attitude to money and teach my children to develop one too. So I’ll be checking out your website for more help with that. Thank you!
My pleasure. I appreciate you taking the time to comment!
I can empathise with that, I don’t remember money being discussed in my house either.
Taking that into consideration, I guess you shouldn’t feel bad to making mistakes. Money management is all about education, without it mistakes and negative feelings are bound to occur!
I’m happy to have helped! More posts around the psychology of money lined up!
I look forward to reading them.
Interesting stuff. I just wrote a piece about trying to balance frugality vs quality of life, and a reader pointed me to this post. Definitely resonates with me because I’m the money vigilant type but I also want to have a good quality of life. It’s a constant tug-of-war between indulging a bit and then feeling guilty about that indulgence. Even when it’s just $9 takeout or even $4.50 hummus that I don’t particularly need (but want). So… yeah. It’s a work in progress.
Thanks for leaving a comment. I’m glad you found it interesting and that it resonated with you personally.
I can empathise, as I would say I’m also money vigilant type. So I agree with you there, it can be a real balancing act!
Rather than ask you what you do to maintain this balance, I will head over to your blog and give your post a read!