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January 29, 2022

Do sad people spend more money?

Hang on to your wallet if you're feeling sad and lonely, suggest researchers at Carnegie Mellon University.

It's not just about feeling blue though. It’s the mix of sadness and self-focus that tends to loosen the purse strings, according to the study.

Individuals who struggle with self esteem are likely to think less of themselves and might be more motivated to boost their self-image with a pricey purchase, the researchers suggest.

A group of volunteers in their twenties were asked to look at two types of video footage, either a 'sad' one or  an 'emotionally neutral' one. Subsequently, they were asked to bid on a basic commodity, such as a water bottle.

The difference in prices — dictated solely by differing emotional states, the researchers maintain — was significant: Bidders in the sad-story group were prepared to pay almost four times more for their item compared with those who entered the auction in a more neutral emotional state.

The subjects that watched the sad videos maintained that the content of the video clip didn’t affect their spending in any way however. In other words, they seemed unaware of the impact their mood had on their decision making.

Of course, advertisers — whose principal aim is take advantage of people's low levels of contentment and appeal to their need to be happy — have known this for years. But many of us still succumb to their pitch. 

One major side effect of all this misery spending though is the realization that most purchases actually don't provide much of a long-term restorative effect. This often leads to buyer's remorse, returned products and the type of ennui that often makes things worse. 

Do you think happy people spend less than sad people? Have you ever used retail therapy as a pick-me-up?

By Gordon Powers, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...