You’ve talked about money management, discussed budgets and had endless conversations about needs versus wants, yet your teens still give in to impulse spending. Here’s why they do it and how to help them get a handle on their money.
What is impulse spending?
Impulse buying is buying something without planning or considering the financial consequences. Most of us are familiar with the concept; we suddenly see something lovely we want and buy it regardless of our budget. This type of spending is characterised by a sense of urgency and excitement that gives you a momentary surge of pleasure.
The problem with impulse spending is that it can quickly become a habit, especially with teens. It’s why tackling it now and finding solutions is crucial to their financial literacy and future financial stability.
10 examples of impulse spending
Buying takeaways through food apps rather than making food at home
Buying things that you don’t need
Purchasing the latest tech because you’ve just seen it on sale
Shopping online when you’re bored or sad
Buying something expensive because it makes you feel better
Buying something on social media as it looks like everyone is buying it
Buying something because you keep seeing an ad for it
Buying something because you believe it will make you feel better
Buying something because your friends are urging you to buy it
Buying things because it manages your stress levels
Why do teens buy impulsively?
Teenagers are more likely to engage in impulse buying than adults, explains clinical psychologist Linda Blair. She says, "it's about a lack of impulse control and the fact they have trouble waiting. So a typical teen will see something, and instead of thinking, they feel compelled to act immediately."
Much of this is down to their emotional and cognitive development. Teenagers are still developing the ability to think and act rationally, so they're more likely to make decisions based on their emotions in the moment. For example, they may buy something they like because it makes them feel good, even if they don't need it.
Research also shows that spending can ease feelings of sadness. A Journal of Consumer Psychology study found that making purchase decisions gives you a boost when you feel down – something teens know well. The average teenager spends £54 a week and adds £1.7 billion to the Uk economy every year.
Moreover, the process of thinking abstractly and planning for the future takes time to evolve. So when faced with a situation where they have to wait, for example, when wanting to buy something, teens have a hard time thinking about the long-term consequences of their actions.
6 signs of impulsive spending
Your teen buys items when they feel sad or bored. Doing this generates excitement and emotions that momentarily help your teen feel better.
Your teen rarely uses the things they buy. This is a sign that your teen is buying for the thrill of the purchase rather than a need.
Your teen has to buy something every time they are out because they love the feeling of buying things.
Your teen always has to borrow money from you. Generally, impulse buyers tend to blow their budgets and have to borrow from the bank of Mum and Dad.
Your teen has way too much stuff. A sure sign your teen is giving in to impulse buys is having way too many clothes, tech, beauty products and more.
Your teen always seeks instant gratification; nothing feeds this more than impulse buys.
5 causes of impulse buying
Emotional state. Feeling sad, stressed, anxious and low are reasons teens might give in to impulse spending. Teenagers are also going through self-discovery and may be struggling with their self-esteem. This can make them more likely to buy things they think will make them feel better about themselves.
Impulsivity. Impulsivity is the tendency to act without thinking about the consequences. Teenagers are naturally more impulsive than adults, as their brains are still developing.
Sensation seeking. Teenagers are also more likely to seek out new and exciting experiences. This can lead them to make impulse purchases, as they may be drawn to the novelty of a new product or service.
Peer pressure. Teenagers are also more susceptible to peer pressure than adults. They may be more likely to buy something if their friends are buying it or pushing them to buy it, even if they don't really want it themselves.
Advertising techniques. Marketers often use methods that are designed to trigger impulse buying in teenagers. These techniques can include using bright colours, appealing packaging, and limited-time offers that pull teens in and push teens to spend money.
How to stop impulse buying
Make a budget and stick to it
While a budget is not a magic solution, it can train your teen into better money management. A budget will not only help to give them a clear picture of how much money they have coming in and going out each month, it will also help them track their spending. This, in turn, allows teens to make informed decisions when faced with a decision about whether or not to buy something.
Start a savings plan
Starting a savings plan as a teen can help with impulse buying in several ways. Firstly, It will make your teen think twice before buying something. When they have to take money out of their savings account to make a purchase, they’re more likely to think about whether or not they really need the item. Secondly, this can help them avoid impulse purchases and focus on bigger financial goals.
Our latest research shows that more than four in ten kids aged 6-18 (42%) say that recent events like the Covid pandemic and the Cost of Living crisis have made them more likely to start saving for big life events – and our data** reveals that GoHenry kids and teens are saving 145% more than they did last year. More than a third (35%) of young people are planning to save to buy a house, and 65% of those already saving have put away up to £1,500 for this purpose*.
Talk to them about advertising and marketing
A powerful tactic in helping teens avoid impulse spending is to talk to them about how brands and shops get them to spend. Tactics like telling them something is selling fast or is limited are there to make them believe they may miss out. Being told something is 25% off, on sale, or used by someone they admire is also there to drive them to purchase. Likewise, TikToks and Reels by influencers pushing health and fashion items tend to be ads (*look for ad sign in the caption) rather than genuine reviews. Show them real-world examples so they understand how they are being manipulated into spending.
Always wait 24 hours before making a purchase
This will give your teen time to consider the purchase and ensure it is something they want. This gives them time to cool off and think more clearly, and also gives them time to forget about the item and let the emotional drive to buy recede. As we all know, the urge to buy something is sometimes just a passing feeling.
Help them identify their spending triggers
What are the things that make your teen more likely to make impulse purchases? Once they know their triggers, you can start to avoid them. For instance, if they are bored or sad, they should talk to someone they trust. If buying makes them feel better, offer support and help them develop strategies to manage this behaviour by looking at the root of the problem.
Close the bank of Mum and Dad
It seems harsh, but closing the bank of Mum and Dad to borrowing can help teens control their spending and live and spend within their means. Our latest research shows almost half of parents (47%) believe that they can help their child to be financially free in the future by teaching them how to budget, how to recognise the difference between wants and needs (39%), and reducing the amount of money loaned or gifted.
Teach your teens about budgeting & saving with GoHenry
GoHenry is a great way for teens to learn about budgeting and financial responsibility. With our prepaid teen debit card, teens can learn all about budgeting in a safe and responsible way. They can also use in-app Money Missions to learn more about budgeting via fun quizzes, videos, and bite-sized lessons for every age. All our lessons are tailored to your child's age and level of understanding.