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The Psychology of Consumerism




One of the main reasons why people get into debt is because they simply spend more money than they earn and then use their credit cards to purchase things, not out of necessity, but rather because they believe it will make them happy or because they are trying to portray a certain lifestyle.


On one side, if at any given point in time, we know how much money we have in say our checking account and we know that we need that money to pay upcoming bills like rent or groceries, but we just happened to see these “must have” items in a store window or online on our favorite influencers social media page, we sometimes justify making the purchase on a credit card by telling ourselves “we deserve it” or “this would make me happy”.


We might further our justification by saying “well, it’s just this one time” or “It’s not a big deal - I’ll just pay it off next month”. A big reason behind those beliefs has to do with the psychology of consumerism or purchasing for happiness. As consumers, it’s important for us to be aware of the ongoing pressures we receive everyday via social media or our friends and family to always have the newest smartphone, the latest car or the name brand designer items.


The concept of "Keeping Up with the Joneses" has been around for a very long time and it’s where individuals feel the need to match the material possessions or lifestyles of their friends or people, they surround themselves with.


For example, your teammate just bought the latest Apple iPhone, so you feel like you have to do the same. Your best friend just purchased a new handbag and you don’t want them to think you can’t afford it, so you buy one as well.


Whether on social media platforms or in our everyday real world, as friends and influencers showcase their latest purchases, vacations, or lifestyle upgrades, this can trigger a desire in us to buy similar items or experiences, not necessarily out of need but to maintain a social parity or image. In the digital era, this concept has been amplified. Platforms like Instagram and TikTok expose us to the meticulously curated lives of influencers and celebrities, fostering a sense of aspiration and competition. We strive not only to keep up with our neighbors but also with an expansive global community.

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