Most people have heard of doomscrolling.
The habit of endlessly consuming negative news, worrying headlines and social media updates can leave us feeling anxious, overwhelmed and uncertain about the future.
Increasingly, another term is entering the conversation: doomspending.
The phrase has grown in popularity over recent years as commentators and researchers have observed a trend of consumers spending money in response to economic uncertainty, rising living costs and concerns about the future.
But while the term may be new, the behaviour itself is not.
A Very Human Response
People have always spent money for reasons that go beyond practical need.
Whether it is comfort eating after a difficult day, booking a holiday during a stressful period, or buying something simply because it makes us feel better, spending has long been tied to emotion as much as logic.
What’s changed is the world around us.
We now carry online shops in our pockets, receive personalised advertising throughout the day and consume a constant stream of news and social media updates. Against that backdrop, it is perhaps unsurprising that spending can sometimes become a response to stress, uncertainty or anxiety.
In simple terms, doomspending describes the tendency to spend money in an attempt to regain a sense of control, comfort or enjoyment when the wider world feels uncertain.
Why Is It Happening Now?
Recent years have brought no shortage of reasons for people to feel unsettled.
The pandemic, inflation, rising energy bills, higher mortgage rates, geopolitical tensions and an increasingly relentless news cycle have all contributed to a backdrop of uncertainty for many households.
Research suggests economic uncertainty may be influencing spending habits. In the United States, where consumers have faced many of the same inflationary and economic pressures seen in the UK, a survey reported by Psychology Todayfound that 43% of millennials admitted to making purchases in response to concerns about the future, a behaviour that has become known as “doomspending”.
While the reasons vary, the underlying theme is often similar:
“If the future feels unpredictable, I may as well enjoy myself today.”
It’s a mindset many people can relate to, even if they don’t recognise it as doomspending.
The Psychology Behind It
One of the reasons doomspending can be so powerful is that it provides an immediate reward.
Making a purchase can trigger a release of dopamine, the brain chemical associated with pleasure and reward. For a brief moment, buying something can create a sense of satisfaction, control or relief.
The challenge is that those feelings are often temporary.
As Morgan Housel writes in The Psychology of Money:
“Doing well with money has little to do with how smart you are and a lot to do with how you behave.”
It’s a useful reminder that financial decisions are often emotional before they are rational. Understanding our own behaviour can be just as important as understanding investment markets or interest rates.
Treating Yourself Isn’t the Problem
Of course, not all discretionary spending is bad.
Enjoying experiences, treating yourself occasionally and spending money on things that genuinely improve your quality of life can be an important part of a healthy relationship with money.
The more important question is why we are spending.
Are we making conscious decisions that align with our priorities and values? Or are we spending primarily to escape feelings of stress, boredom or uncertainty?
Simply pausing to ask that question can often lead to better financial decisions.
Building Financial Confidence
One of the most effective ways to reduce financial anxiety is to create greater clarity around your finances.
Having a realistic budget, maintaining emergency savings, understanding your long-term goals and having a financial plan in place can help create a sense of control when uncertainty inevitably arises.
Financial planning cannot remove uncertainty from life. Nothing can.
What it can do is help ensure that important decisions are guided by your goals rather than your fears.
Final Thoughts
Doomspending may be a growing financial buzzword, but the behaviour behind it is as old as money itself.
Humans have always looked for ways to feel safer, happier or more in control during uncertain times. Today’s difference is simply that spending has become easier, faster and more accessible than ever before.
Understanding the psychology behind our financial decisions does not mean never treating ourselves or enjoying our money. Rather, it means recognising the difference between spending that genuinely adds value to our lives and spending that is simply an attempt to ease temporary feelings of uncertainty.
The future will always contain unknowns. The goal is not to eliminate uncertainty, but to ensure our financial decisions are driven by our priorities rather than our anxieties.