Understanding buyer's remorse and how to break the cycle

My shopping habit has a pretty reliable cycle: see, want, buy, regret.

It doesn't matter how many times I experience buyer's remorse, I still make the same spending mistakes.

I saw some improvement after a recent clothes shopping pause, but I'd really like to reduce the amount of things I buy that don't meet my expectations — or my budget.

And I'm not alone. A survey of Aussies in 2022 found almost 60 per cent feel guilty about their spending.

I spoke to a couple of experts to find out how we can harness our feelings of remorse to avoid repeating our money mistakes.

Defining buyer's remorse and why we experience it

Buyer's remorse is the result of a form of "mindless spending" where not much thought is given to the repercussions of a purchase, says Lea Clothier, a behavioural money coach and former financial adviser based on the Gold Coast.

Feelings may include regret, anxiety and guilt.

Ms Clothier says it's about the perception of the purchase and whether it "meets our expectations or aligns with our needs and desires".

It can happen with items of any monetary value, and Ms Clothier says if we went into debt to buy it, that could increase the likelihood of buyer's remorse.

We may also experience spending regret when influenced by social media or perceived peer pressure to "keep up", says Richard Gough, a financial adviser based in Melbourne.

"We see our family and friends with a big house or going on holiday, and we think, they have that, and therefore I should too."

He says whether you are a frivolous spender or frugal, you aren't immune to buyer's remorse.

"Even people who are good with money and budgeting might [experience it] because they are stressing about every dollar they spend."

Why we keep making the same mistakes

Ms Clothier says if we spend money as a form of entertainment, self-soothing or distraction, it can be a difficult habit to break.

"Breaking the spending cycle can be challenging due to the various psychological factors, such as habit formation, emotional triggers, and the desire for immediate gratification."

Mr Gough says we repeat the pattern because we are always trying to "fill the void", whether it's clothes, cars, or takeaway food.

Ms Clothier says buyer's remorse may be more common during sales, where we make purchases under time pressure and without proper consideration of the impacts on our budget.

Using buyer's remorse as a 'learning tool'

Using buyer's remorse as a learning tool can transform negative experiences into opportunities for positive change, says Ms Clothier.

One strategy is to slow down our spending habits and make them more mindful.

Ms Clothier recommends introducing a pause (such as not buying clothes or other items for one month) which can help us reflect on our patterns and habits.

"Ask ourselves why we need something, or what we think it will add to our lives?

"We can also benefit from our future selves and asking, would future-me be happy that I made this purchase? And, what else could I be using this money for?"

Some of Ms Clothier's tips:

• Work out why you feel the remorse. Is it impulse, unmet expectations/feelings, or unaffordable purchases?
• Look for patterns, like is there a time of day, emotion, or a person who triggers you to spend?
• Set goals and create a budget to bring clarity to your spending decisions.
• Practise delayed gratification, starting with a 24-hour no-buy freeze when you see something you want to purchase.
• Make yourself accountable by sharing your financial goals with someone else, or seek advice from a financial expert.
• Create a wants/needs/likes list. This can help you prioritise purchases.

Mr Gough says planning ahead will help curb regretful purchases.

"A budget itself is good in theory, but what you need is a banking system."

He says having your accounts set up in a way that allocate money for certain purchases — for example, bills versus eating out — help gives you some control.

"Being organised and allocating money to certain buckets will help you stop spending money you shouldn't be spending.

Lastly, Ms Clothier says if you bought something you regret and can return it, do so.

And read terms and conditions for future purchases so you can get your money back for change of mind.

Disclaimer: This is general information only. You should consider obtaining independent professional advice in relation to your particular circumstances.