Excessive or Frivolous Spending
When it comes to aging, most seniors can’t buy whatever they want. Constant spending can create terrible problems for seniors and their families. We call this excessive or frivolous spending. What are the issues? How do you address them?
Excessive and frivolous senior spending is when a senior spends a lot more than they should. Characteristic of excessive senior spending includes:
Reasons Why Senior’s Overspend
In other words, excessive spending is when we forget to consider the implications of spending too much. There are a variety of reasons that my lead to excessive spending. Here are a few.
Excessive Spending – Mortality Anxiety
Some seniors overspend because they have mortality anxieties. This anxiety can result in behaviors that result in seniors overspending.
In My Old Age, I Want Everyone Else To Have All My Money
Some seniors want to be generous and start to give their money away. It might be to family, friends or faith-based organizations. Generosity is an important part of caring for your family, friends, and community. But if that generously impairs your own ability to live, you can quickly become a burden on the same people you were trying to help.
Frivolous and excessive spending even when given for good causes can lead to problems that you’ll regret. Your generosity can be expressed in other ways. Donating your time, sending ecard cards, making telephone calls can substitute for money. Moreover, if you overestimate your needs and have money left at the end of your life, you can use your will or trust to disperse the funds the way you want.
I Will Not Live Much Longer
Some seniors realize that their remaining years are limited. In reaction, they overspend. They may rationalize the spending by the assumption they will be gone in a few years, or won’t remember they spent all their money, or don’t care that others may need to step in for them to manage their life. If the senior thinks they’re going to die shortly, and acts accordingly, they can literally place themselves in a metaphorical casket. Spending all your money can make you both dependent and poor.
Excessive Spending – Poor Planning
Some seniors overspend because they have poor planning skills.
Not Having a Budget or Losing Track of Big Picture
If you have a few million in retirement savings, you may not need a budget. Your accountant, tax attorney and financial advisers probably help you keep track of spending. The rest of us need a budget. Budgets help us understand how much we spend and on what. If our income changes, we can look at that budget and make necessary adjustments or seek ways of extending our resources. In other words, budgets keep us from excessive spending.
Losing Site of Goals
Goals are a great way to minimize frivolous spending. If I have a goal I can focus on objectives. Stay on track. A budget is a goal. Saving to make a church donation is a goal. Saving to help a grandchild attend college is a goal. Losing track of our goals, or not using goals for extra spending is a common way to spend frivolously.
Excessive Spending – Behavioral Control Issues
Urges & Impulse Control Issues
Despite what some coffee shops want us to believe, America doesn’t run on Dunkin, it runs on buying things. Our entertainment is embedded with ads trying to get us to buy something. Watch a TV program, get a bunch of ads. Search the web, get a bunch of ads. Drive down the street, see a bunch of ads. Open a magazine, see a bunch of ads. Some percentage of our grandchildren will make a living on social media as “influencers” getting people to buy things. Spend sixty, seventy or eighty years in this environment and its likely we’re susceptible to impulse purchases.
Easy Credit & Ways To Pay
Easy credit in the form of credit cards and online payment services make buying much easier than when we used cash. Digital transactions simply are less real to us than cash transactions.
Bottom line, it’s easy to spend frivolously and excessively. Make a budget. Keep track of what you spend. Match spending against your budget. By doing this, if you overspend, you know where you’re doing it, and can make necessary changes.