Beware, Penny Hoarders!
A psychological phenomenon known as “licensing” may cause you to splurge in one area when you do the “right thing” in another, according to a recent study.
For instance, when I walk to work in the morning, it feels less indulgent to buy lunch. Ever follow up that healthy salad you had for dinner with a hefty slice of cake for dessert? That’s licensing.
How Licensing Makes You Spend More Money
Researchers Uma Karmarkar and Bryan Bollinger observed shoppers’ behavior at a single grocery location in California. Over the two year study, they tracked almost one million transactions.
They found customers who brought their own reusable bags purchased more food — both the healthy, green organics you’d expect, and junk food.
The researchers surmised the customers “rewarded” themselves for their environmentally sustainable actions by treating themselves.
Their takeaway: Doing something good makes us feel like we’ve earned a slip elsewhere — and that slip can cost you.
Be on the Lookout
Beware: Licensing can lead you to spend money you didn’t plan to spend on items you wouldn’t have purchased otherwise.
Next time you feel good (which you should!) about your healthy purchases, expert coupon clipping or growing savings account, be on the lookout for the little indulgences that might be sneaking into your budget elsewhere– they can really add up!
Your Turn: How do you indulge yourself when you’ve done something good?
Jamie Cattanach is junior writer at The Penny Hoarder and a native Floridian. She’s passionate about learning, literature, chocolate and finding ways to live the good life as cost-effectively as possible.