Facebook Pixel

How Unusual Purchases Can Add Up To Unforeseen Costs - HER Daily Dose

 
Rate This

More Videos from Bailey Mosier 30 videos in this series

Father’s Day came and went – did you buy your dad a present? And how about your friend’s birthday coming up? Oh, and how much did it cost you to get your car repaired last week? A recent study found that all of these unique type purchases add up quickly and consumers routinely underestimate and overspend on unbudgeted purchases.

Hi, I’m Bailey Mosier. This is your EmpowHER HER Daily Dose.
Father’s Day came and went – did you buy your dad a present? And how about your friend’s birthday coming up? Oh, and how much did it cost you to get your car repaired last week? A recent study found that all of these unique type purchases add up quickly and consumers routinely underestimate and overspend on unbudgeted purchases.
Researchers from Princeton University and the Stern School of Business at New York University found that consumers forecasted ordinary expenses accurately but underestimated how much they would spend on unbudgeted purchases such as birthday gifts, car repairs, or luxury chocolates. Consumers were willing to pay more for these items when presented one at a time than when they were presented all at once, failing to incorporate it into their budget as one in a series of unique purchases.

Failure to aggregate unusual purchases leads consumers to splurge on what they would view more conservatively if they understood these connections. It’s important to understand these differences and budget for both ordinary and unique expenses so as not to overspend or under-save.

That wraps up your EmpowHER HER Daily Dose. Join me here at EmpowHER.com every weekday for your next dose of women’s health.

Add a CommentComments

There are no comments yet. Be the first one and get the conversation started!

Image CAPTCHA
Enter the characters shown in the image.
By submitting this form, you agree to EmpowHER's terms of service and privacy policy

Financial Health

Get Email Updates

Health Newsletter

Receive the latest and greatest in women's health and wellness from EmpowHER - for free!