Just when many consumers are trying hard to stick to budgets, some companies are doing whatever they can to persuade us to ignore those frugal plans.
Last night on television, I saw a Discover Card ad that began, "We are a nation of consumers. And there's nothing wrong with that," against a backdrop of plasma televisions and iPods. Oh, really, there's nothing wrong with that? With the personal savings rate hovering around 0 percent and the average American carrying $16,635 in debt (excluding mortgages), I would argue that there's a lot wrong with that.
While relatively weak retail sales throughout this year suggest that many consumers are ignoring these kind of advertisements and tightening their belts anyway, there's plenty of evidence to suggest at least some shoppers are splurging like they always have. A new survey from HSBC Direct found that over half of respondents said they "splurged" within the last month, because it relieves stress, it feels good, or they simply deserve it. In fact, 1 in 5 respondents said saving money requires more discipline than quitting cigarettes. I don't mean to be insensitive to people who struggle with shopping addictions (a condition that afflicts about 2 to 5 percent of the population), but if spending feels as addictive as nicotine, it's time to seek professional help.
The survey does not describe just what kinds of things people are splurging on, so it's hard to judge how much it matters. To some people, a latte is a splurge. To others, it might mean a new Pucci dress. I strongly believe in the pleasures of small purchases and think everyone should find a way to set aside a small amount each week for things that make them happy, such as a yoga class or chocolate-chip cookie. But splurging out of habit sounds like a waste to me.
What do you think—are you prosplurge or skeptical of its benefits?