How to avoid overspending in the post-pandemic period
As health restrictions ease and more people get vaccinated, many Canadians are eager to make up for lost time.
The phrase “revenge spending” has become common, suggesting that some people are anxious to waste consumer goods or experiences they were forced to give up last year.
In the United States, where restrictions were lifted faster than in Canada, most spending was in beauty and nail salons, sporting goods stores, restaurants, clothing stores and car dealerships, according to a recent TOP Data report on post-pandemic recovery.
The phrase “revenge spending” was new to Liz Schick, a certified financial planner at the New School of Finance in Toronto, but it’s a phenomenon she’s familiar with, especially when speaking to freelance professionals, hard workers. seasonal workers who experience fluctuations in income throughout the year. .
When the period of inferiority is over, it’s often like, “Woohoo, we’re going to spoil ourselves!” I want to do lots of fun things! “. It is a natural reaction not to be able to do anything.
Liz Schick, financial planner
While all demographic groups feel the need to party and spend, young people in particular may be motivated by the feeling that they have been robbed of precious time, El-Sayed continued.I Check.
“This is the time when they want to go out, they want to go to bars, they want to go to concerts, they want to take a lot of trips and they want to see their friends. A lot of people are very social during this period of their life, they really missed it and it made sense. ”
Ally Bly, a 31-year-old employment counselor from Toronto, can’t wait to dine with friends, sip cocktails at her favorite bars, attend concerts, visit museums and galleries and visit her. friends and family in Ottawa once she finally receives it. second dose of Pfizer vaccine. .
“When going out is safer, I will definitely consider the possibility of doubling my spending, for example if I maintain my epidemiological habits, and spend more money on groceries and online shopping,” while spending money. money to go out or take trips. noted Mr.I Yes.
“If I did, I might end up using more of my savings to cover these costs, rather than keeping a small reserve or investing a certain amount.”
More opportunities to go out and celebrate
When people get a job promotion or celebrate a birthday or vacation, they may be tempted to spend more, but there is a clear end period for those expenses, notes Avni Shah, associate professor of marketing at the University. from Toronto and researcher at the University of Toronto. Rotman. School of Management.
“Where it’s a little exciting and a little more dangerous than typical cases when it’s not just related to a one-time event,” she said.
Now, there is a motive for people to spend when they are fully immunized, maybe when a spouse is vaccinated, then when every good friend is vaccinated, etc.
said Mr.I Shah, which increases the likelihood of overspending when spending.
advice from Mr.I Shah must make informed decisions about spending, especially when it comes to material goods. She recommends making a list and asking yourself, “What makes me want the most?” “” By lifting the containment measures.
“It is better to look for these items on purpose than to shop recklessly, which can lead to problems,” she added.
This tactic can also be applied to social and group experiences, such as parties with friends.
For experiences outside of that, it’s best to look for cheaper options, like a happy hour drink, for example.
MI Shah andI Schieck recommends budgeting to determine exactly how much money should be allocated for personal services, consumer goods, big-ticket items (such as travel), or experiences with friends, family, or even acquaintances.
It can be easy to forget because [dépenser de l’argent pour sortir] It had not been in our budget for a long time, because of COVID, ”noted Mr.I Shah. “It is not like that in our habits anymore.”