Amazon Prime Day Hacks and Budgeting Tips for Emotional Shoppers

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13:47Sean Pyles:That's q-u-i-n-c-e.com slash smart money to get free shipping and 365-day returns. quince.com slash smartmoney. We are back and answering your money questions to help you make smarter financial decisions. This episode, we're talking with a listener, Catherine, who wants some help getting a grip on their spending and budgeting. Catherine, welcome to Smart Money. Hi, thank you so much. Great to have you on. So I'd like to start by hearing about your financial life at a high level. So right now, thinking about your money, what makes you feel proud? What maybe makes you squirm a little bit? I'm not really a numbers person.

14:24So money is one of those kind of difficult topics anyway. But I do have a little bit of pride in the fact that my partner and I have been working with a financial planner for a few years. So we do have our big picture money plan under wraps. I mean, I think we feel we have like a pretty good sense of investing and a general sense of like six months out budgeting. The stuff that makes me squirm is actually my personal relationship to money and just kind of how I approach it and what kind of emotions come up. and the questions that I have in terms of prioritizing and making decisions and the guilt that I feel when I buy something or how to decide where my money goes.

15:22And it feels kind of silly, but it also feels kind of like a really big question. So I thought I'd reach out to you guys to see if there's a way we could talk about it.

15:34Sean Pyles:Yeah. Well, what you're describing, it might sound silly, but it's really common. A lot of people have feelings of guilt and shame around how they spend their money because they think they quote unquote should be doing something different or better. And we can get into that.

15:49Elizabeth Ayoola:So what is the current budgeting system that you use for your money? Do you have a budgeting system or do you kind of just pay yourself and what's left over? That's what I do, by the way. You didn't ask, but I'm telling you. But anyway, tell me what you do. My personal budgeting system doesn't really exist. Interesting. Yeah.

16:08Sean Pyles:All right. Well, talk with us a little more about your income and expenses, because that's what your budget is made of. So what do you have coming in and going out on a regular basis? You had filled out a budgeting spreadsheet for us a bit before, so that's been helpful as a jumping off point. But how do you think about what you have as a regular expenses on a monthly or even weekly basis? So my regular income is from my job. It's not a high earning job, but I'm contributing to our household and covering rent, basically. My husband is looking for a job and his intention is to get a high earning job.

16:47He's been really, really working towards that, but he just finished his PhD last year. And so there's been this sort of expected long buffer period. And we have investments that we've been working with and living off of for this past year. And then we have an additional income source that comes in quarterly that kind of helps buffer a little bit of our spending. But we can't use that. We just have it as like an emergency fund. So what we're using for our living is my income and these investments.

17:31Sean Pyles:So you're selling off investments to cover some ongoing expenses. Are you accounting for tax liability when you're selling those off, putting aside some money? Yeah. That's good to hear. And when you've worked with your financial planner and they've looked at your income and expenses and financial goals, what have they said about how you're managing your money on a daily basis? Do they have any suggestions for you? We've spent time on the big picture and we just haven't really done work with them, particularly on the small picture. So, yeah, I feel like I've kind of been left to my own devices on that a little bit.

18:05Elizabeth Ayoola:I know you are partnered and I know you said you don't have a budget, but does your husband work with a budget? I think so. He's very, very structured. Yeah, I don't know his budget, actually. That's an interesting question. I probably should know what he's working with. Well, if you're comfortable sharing, how do you guys approach managing your finances as a couple or do you manage separately? We're very comfortable talking about everything. I get overwhelmed talking about money. And so he handles most of it. And so I don't feel like I really I hate to say care, but like I don't really I can't really like keep track of his spending or his budgeting or like what his numbers are.

18:48Does that make sense? Mm-hmm. Yes.

18:51Sean Pyles:So talk with us about what exactly makes you uncomfortable when you're spending money or when you're thinking about engaging with it, and then how we can help you get through those feelings, with the caveat that, you know, I'm not a therapist. Yes. Yeah, of course. And I will just mention that I have talked to my therapist about this before, but I do feel like there's got to be some way to kind of approach this more surface without making it a huge emotional weight. Yeah. The guilt is pretty big and the confusion. I think another question I wanted to bring to the table for you guys was when you have these opportunities for prioritizing, when you have your own cash flow, you know, like, let's just say there's no emotion attached to it.

19:40How do you prioritize one spending over the other?

19:45Elizabeth Ayoola:I can empathize with feeling overwhelmed, first of all, but I think it's really important to tackle the discomfort that you're feeling before you dive sometimes into trying to manage your finances. The exercise that I did years ago to try to understand better why I felt so uncomfortable with money is I did a lot of journaling around my money values. And as you said, it really sometimes is rooted in maybe how you saw your parents managing money and all these values that you picked up along the way, even just from watching TV shows or from anything really that you adopted. And one important thing that I did is separate and say which of these values are mine and which ones reflect who I am and my values as an adult versus ones that I got from other people.

20:30Elizabeth Ayoola:So that's something that helped me tremendously.

20:32Sean Pyles:As you're thinking about your money and what to do with it, Catherine, the hard part is that you can never take the emotional aspect out of it. So just understand that. But I really want to get deep into the specifics around your feelings. You've mentioned feeling guilt. So when do you feel guilt? What specific actions or moments are triggering this feeling in you? I think it's probably a big spend, something like over$50 in one purchase or something that felt kind of like, oh, I just want this and I don't know why. And I didn't, you know, click my or something. Maybe a purchase from a place that doesn't align with my values, like a big box store or something like that.

21:20Sean Pyles:I'm wondering if some of the source of this guilt is the disconnect between purchasing what you are getting and maybe not knowing whether you totally have the funds to cover it. It seems like you do have enough money coming in, but because you aren't as familiar with the actual numbers as you could be, there is perhaps a bit of uncertainty around, okay, how is this going to fit into a bigger financial picture? That sounds very plausible. Yeah. One thing I would encourage you to do when you feel guilty about a purchase is ask yourself initially what you were actually hoping the purchase would do for you.

21:56Sean Pyles:Because sometimes we buy things as a coping mechanism. And the hard part about spending as a coping mechanism is that it is super easy to do, especially in the era of online shopping. It actually is effective because it makes you feel good. But the hard part is that it's never really satisfying. and you can feel worse afterward like you're describing, like feeling guilty. Are you familiar with the concept of the hedonic treadmill? No. So it's this idea that we are all, everyone on this planet, on this treadmill of hedonism, if you will. So you can make a purchase or acquire something and it feels really good, but then you are quickly back at that baseline feeling of happiness that you have.

22:38Sean Pyles:So even though you got that spike of dopamine, it's never really going to last. Are there certain times of day or certain feelings that are more common that maybe lead you into purchasing? Have you been aware of any of those patterns? Probably stress, which would make sense. I don't know if I have diligently monitored what might be leading into it. I do know the online thing happens late at night for sure. Yeah. Yeah. Very common. Yeah. I think that's like, I'm half asleep and a package shows up the next day. Your guard is down. I'm like, what is this? Yeah. The stress thing is real. I think if I've had a long day and I could go to the gym or I could go to the shoe store, like, yeah, I'm going to probably go to the shoe store.

23:32And that feels sometimes bad instead of good, but also good, you know?

23:40Elizabeth Ayoola:I can absolutely relate. And I had an issue last year with emotional buying. I would buy when I was happy, when I was sad, when I was angry, every emotion I needed to buy something, whether it was food or something else. But what really helped me was finding another coping mechanism or even just an outlet for when I am feeling happy, like, girl, you're happy, but you don't need to go buy something. I have adopted lots of hobbies now. So when I'm happy, I can go paint or I can go and ride my bike. And I have this nice little Bluetooth speaker and I play my music really loud while I'm riding my pink bike.

24:10Elizabeth Ayoola:So I think it's just about looking for things that can help with that emotion versus going to spending. I have a part of my budget that is allocated to me spending on things that I want.

24:22Sean Pyles:And that's why budgeting, a lot of people can think of it as restrictive or like almost patronizing in a way. But in fact, it can be a way to liberate your spending because you know that you have the intentionality and the purpose behind where you're allocating your dollars. At NerdWallet, we talk a lot about the 50-30-20 budget for good reason. 50 % of your income goes to cover your obligations, things like housing, any sort of medical expenses you might have, credit card debt, etc. And then 30 % goes towards your want category. That is the more discretionary purchases, things like eating out.

24:55Sean Pyles:20 % goes towards additional debt payments and savings. NerdWallet has a budgeting app where you can use this for free. Have you ever tried playing with a specific budget framework or an app? There are so many out there to play with. So what I have done before, which was probably as close as I've gotten to actually budgeting, was at the end of the month for about two years, every month I would just go through all of my finances and all of my expenses and I would just like write them down. And it just gave me a sense of like, okay, I know where that went. Like I caught a few misspends and everything, but it wasn't necessarily giving me rules.

25:37So I'm still, I'm sort of back to square one.

25:40Sean Pyles:I think what's going to help you is to experiment a bit. One really helpful thing that I've done in the past is for a single month, I tracked every single penny that came into or went out of my life. And I would track it in the moment. And I would also add on like what exactly it was I purchased and how I felt about that purchase. The idea is really just to understand exactly what you're doing and when and how you feel about it. Because then you can sort of see patterns over time, mitigate some of those feelings of guilt and just create pure opportunities for you to feel bad about how you're spending.

26:15Sean Pyles:Cool. I appreciate that.

26:17Elizabeth Ayoola:And also, Catherine, I want to know, do you have any fears or also uncomfortable feelings around learning more about money? So I know you said you are not very familiar and your husband does all of the things and you kind of just don't know. So do you feel overwhelmed in terms of even just digging into more information about budgeting systems or whatever other financial goals you have? I think that's a really astute question observation because I feel like there have been times when I've been able to sit down and spend an afternoon like those those months where I was just like actually on the 31st or the 1st I would be like okay I just got to do my summary thing and I felt empowered and I was like oh I could do this actually it doesn't it doesn't seem so scary but stepping away from it it just feels really huge and confusing and overwhelming.

27:14And like, there's so many layers and aspects and it feels terrifying, honestly.

27:21Sean Pyles:Part of that can come from the distance that you've created between yourself and your money. When I think if you downloaded some of your bank statements or you pull up your credit card app on your phone, and you see where your money is going, having that familiarity really vanquishes some of the fear behind it. But there are some simple tactics that can help you do that too. Like maybe you want something that's more regular and smaller than that monthly review of your spending. Do you want a little prod from your reminders app on your phone every day? Is there a budgeting app that might have a push notification for you every day to say, hey, here's where your spending landed today.

27:58Sean Pyles:Just make it as easy as possible and try to distance your actions from senses of shame because you are just responding to your life one day at a time. You're trying to make the best that you can out of it. But also I think getting really clear on those high level goals that you have might help you focus your spending too because it's not just budgeting for the sake of budgeting. It's budgeting so that you can use your money in the way that's most productive for you long term. When you think about your money on a day-to-day basis, how often are you connecting it to that longer term plan that you and your partner have made with your financial planner?

28:34Sean Pyles:Never. Is he shaking your head here? Yeah. Well, think about that, because it's one of those things where every little action that you take makes it easier or harder to accomplish those goals.

28:47Elizabeth Ayoola:Sometimes people think that your relationship with money is this rigid straight line and you always have to be doing the right thing, even when you know all the things to do. But just as with any relationship, it ebbs and flows, right? So I think remembering that can help with the shame. That's something to keep in mind as well. I don't really think in terms of goals or long-term picture very well. I'm kind of like more of an immediacy experiencer person. And so what you were saying, Sean, makes a lot of sense, but I don't really relate to it in terms of planning for the future. It's like when there's something shiny and beautiful in front of me, that feels like the most important thing in the world to me at that moment.

29:34And so I guess I'm just curious if you have any thoughts or opinions or ways of handling that kind of critical moment where I'm standing there and I'm like overwhelmed with this sort of guilt and desire and, you know, vacuum that's like potentially could be filled with a lot of things.

29:56Sean Pyles:Yeah. The excitement of almost buying something is so great. I think we all know that thrill. Something that walks me back from the edge is this mantra I've heard around the personal finance space, which is just that I have enough and I do. Try to redirect yourself. And it takes this sort of meta thinking as you are in the store or online to pull yourself back and consider why am I feeling this emotion? How have I trained myself to get so hooked on this dopamine rush of buying something? And how can I redirect that energy? It is challenging and it's a muscle that you have to build over time. And you can also create more like physical tactile buffers, like deleting all of your payment info from your apps on your phone and on your web browser, maybe just carrying cash with you, make it less easy for you to buy things when you have that sudden impulse and it feels so good just to do it because then you know on the other side of that purchase are those feelings that are not so great.

30:55Elizabeth Ayoola:Apple Wallet, count your days. I have deleted all my cards from Apple Wallet actually and it does work. Thank you. Those are great. I think it was really helpful to get into that nice space of getting down to that really critical moment of the dopamine rush And on the other side of that, I'm trying to go to grad school in the fall. I haven't been to school in about 20 years, and I'm expecting it to be a pretty different experience than what I've been doing for the last 20 years. and so I'm anticipating that I'm going to have kind of a lot of adjusting to do. Do you guys have any suggestions or thoughts about ways to budget or handle money when you're under a lot of stress?

31:45Just long-term big picture.

31:48Sean Pyles:I think you should give yourself a little bit more credit as being a long-term thinker because going to grad school, planning to go to grad school, thinking about what your career might be after grad school, that's all long-term thinking. So even if you don't recognize that in yourself, you're doing it. So appreciate that. And ahead of going to grad school, you can use these summer months to try out a few different systems that work well for you. One that I rely on a lot is called paying yourself first, where when I have my paycheck come in, I have my direct deposit set up to go to a handful of different savings and checking accounts that I know I'm putting money in my emergency fund.

32:22Sean Pyles:I I know I have it in my checking account to cover my mortgage and any other needs expenses, but I'm not managing it day to day in a way that's super hands on. I did that administrative work in the front to make sure everything would just be going on its own. That might be something that could work for you. And also what's coming up for me is, like you said, if I use the summer months to get kind of get structured and get familiar, then actually maybe I could lean on my husband's structuring abilities to kind of help set up this planning and like front end work. Let him know what I've found and then have him help me with that as well.

32:59Sean Pyles:Well, Catherine, thank you for being so open with us about your finances today and how you feel about it. Keep us posted on how everything goes for you. I'd love to hear about how your budgeting journey goes from here. Thank you both so much. I really appreciate being here. And that is all we have for this episode. Remember, listener, that we are here to answer your money questions. So turn to the nerds and call or text us your questions at 901-730-6373. You can also send us an email. Our address is podcast at nerdwallet.com.

33:26Elizabeth Ayoola:We would love you to join us next time to hear the latest money news and also how you can manage a big windfall. Follow Smart Money on your favorite podcast app that includes Spotify, Apple Podcasts, and iHeartRadio to automatically download new episodes.

33:40Sean Pyles:Here is our brief disclaimer. We are not your financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances. This episode was produced by Tess Vigland, Hilary Georgie helped with editing, Nick Karisimi, Mixer Audio, and a big thank you to NerdWallet's editors for all their help.

34:00Elizabeth Ayoola:And with that said, until next time, turn to the nerds.

34:09Sean Pyles:Hey, smart money fan. If you're getting this, it means that you're living in the Chicago area where Elizabeth and I are going to be recording some live episodes really soon. And we want to hear from you.

34:18Elizabeth Ayoola:And if you have been following the show, you know that Chicago has become my second favorite city in the world. And I'm so excited to be there. We want you to do us a favor and start sending in your money questions, especially if you want to come sit with us live. Maybe you have an issue with retirement savings and you're falling behind. Maybe you are trying to figure out how on earth you're going to budget in the current economy. Whatever your question is, we want to hear from you.

34:42Sean Pyles:Email us at podcast at nerfballot.com with the subject line Chicago with your question. And hopefully we can talk to you when we're in Chicago in mid-October. Fall is the perfect time to refresh and reorganize your space. At the Home Depot, find power tools and tool sets starting at$50 to help tackle DIY projects. home updates, and more. Whether you're drilling brackets to support new shelving or sharpening your hedge trimmer blade with an angle grinder, The Home Depot has the tools you need to check projects off your list. Shop Labor Day savings at The Home Depot and gear up for fall projects with the right tools to keep your projects moving.