Facebook F YouTube Facebook Square Twitter Instagram old-typical-phone Chevron Down Phone menu times down

Christmas Shopping The FQ Way


    Paper bags near wall 749353

    Do you shop at the last minute? Or on an empty stomach? Do you shop alone or with companions? Do you have a list? Do you start with big ticket item gifts? 


    Chances are, you already have your set ways of doing your holiday shopping. I wish to share with you some steps you may consider so you don’t blow your savings or exhaust yourself in celebrating the birth of the baby in the manger. I don’t think He’d like that to happen to you. I guess, He would want you to be a bit more rational in doing your Christmas shopping. So, let’s apply some Behavioral Economics principles in the steps. 


    Behavioral Economics (B.E.) is a relatively new field that is the fusion of Economics and Psychology. It highlights the social, psychological, emotional aspects in the actual human behavior, as opposed to the always rational (always maximizing utility and minimizing cost) consumer assumed in traditional Economics. 


    In today’s lingo, what we’re trying to do is to hack our predictably emotional shopping behavior so that we don’t end up miserable after the holiday season. Here are the steps.


    1. Have a shopping plan. Treat it like a mission with time, strategy and end goal all listed down. Choose your shopping venue well to avoid driving from one place to another. Time is a valuable resource. Calendar a shopping appointment with yourself. In B.E. this is called a commitment device. This will help you prepare mentally for the event, instead of doing it on a whim.
    2. Sleep well, eat well. Have a restful sleep at night, then have a good breakfast taken at a strategic time – i.e. not too early so as not to be hungry after only an hour of shopping. Protect yourself from the perils of the B.E. principle called ego depletion. It is the human tendency to make irrational decisions when we’re in a “depleted state” (i.e. hungry, angry, etc.)
    3. Leave the credit card. If you’re not yet disciplined with the use of your mighty plastic, don’t bring it. The B.E. principle called pain of paying states that we feel the pain more when we pay with cash compared to signing those charge slips. What more, shopping with cash automatically puts a stop when the cash supply runs out. But if you want to bring your credit card just as a “security blanket,” agree on a trigger with your spouse or FQ Buddy, similar to a password that should be activated by both of you before you can start using it. I’ll leave that up to your creativity. 
    4. Self-affirmations before shopping. B.E. studies show that when we remind ourselves of our positive traits before we go shopping, we tend to shop less. This, my friend, is the very basis of retail therapy. Someone who feels terrible would need more stuff to feel better about herself. The problem with this therapy is that it seems to be the opposite of the meaning of the word therapy (treatment). At best, it’s a palliative. But of course, retailers don’t want to use that word.
    5. Dress up well. We always hear the advice to shop in comfy clothes but please don’t overdo it. You still have to look good (comfortably so). Why? Salespeople are only human and they have a tendency to treat well-dressed customers well, and do the opposite to those who are not. I know a story of someone who was not treated well by the saleslady because she wasn’t properly dressed. To show her financial capability, she exaggerated her purchases on that day. So we see two irrational behaviors at work here. Unfortunately, the cost was carried by the customer. 
    6. Schedule a break. Hungry stomachs and tired feet make irrational decisions – i.e. ego depletion discussed in no. 2.
    7. Shop alone. We are affected by our companion such that when she starts buying stuff that’s not within our budget, we might do the same. This is mob/herd/pack mentality, our tendency to be influenced by peers in our behavior.  Moreover, there’s also pressure to make the purchase right away if someone’s waiting for us.
    8. Stick to the plan. Detours will most probably increase your purchases, or at the very least, waste your time.
    9. Buy the less expensive items first. There is a B.E. principle called anchoring, which is the human tendency to use the number first suggested to us as a basis or anchor (no matter how unrelated the number is). So, if we’ve already made a big-ticket purchase at the start, chances are, it would be easier for us to purchase higher-priced goods after.
    10. Record your purchases. Once you get home or as soon as practicable, update our excel file and input the items you purchased together with prices and tick off the items done. Ticking off gives a sense of accomplishment. If you’re not yet done, plan your next trip and follow the 10 steps all over again.

    Christmas gift giving can be a source of stress. Billions of hard-earned cash seem to be put in oftentimes “useless” gifts that we both give and receive. This is why some want to boycott the Christmas gift giving frenzy. But if you feel that it’s a tradition worth continuing, just make the best to enjoy it. Remember Christmas gift giving is not really an economic exercise. It’s not all about the utility of the gifts, but it’s really a social exercise. We belong to a society that observes certain norms of behavior. It’s a cliché because it’s true: In the end, it’s really the thought that counts. 


    I wish to end this piece with an invitation for you to take the FQ Test, a short quiz that will give you a score of both your money knowledge and behavior. Take it by yourself or with your loved one(s). This might be one of the best Christmas gifts you can give to yourself and loved ones. And it’s free! 


    Merry Christmas to all of you!


    *****************

    Rose Fres Fausto is FQ Mom (FQ stands for Financial Intelligence Quotient). She was an investment banker turned full-time homemaker and now a writer and speaker on money and family. She’s a Gallup Certified Strengths Coach and Behavioral Economist, having trained under Dan Ariely, the Father of B.E. Richard Thaler, and recently completed a B.E. course at the Harvard Business School. She wrote bestsellers Raising Pinoy Boys, The Retelling of The Richest Man in Babylon (English and Filipino versions), FQ: The nth Intelligence. She has a weekly column in PhilStar.com and regularly contributes to other magazines. 


    Follow FQ Mom: Facebook | Instagram | Twitter | YouTube 


    Share this article



    Post A Comment
    You must be logged in to post a comment.
    Rose

    AUTHOR BIO Rose Fres Fausto is FQ Mom. FQ stands for Financial Intelligence Quotient. Investment banker turned full-time homemaker, she is now a writer and speaker on money and family.




    Similar Articles


    INLIFE SHEROES uses third-party services to monitor and analyze web traffic data for us. These services use temporary cookies during user sessions which are automatically deleted after session termination. Data generated is not shared with any other party. For more info, please see our Privacy Policy.