Hey, guys. It's Chelsea from
The Financial Diet. And before we start
this week's video, just a quick reminder, if you
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secret society. I promise you, it is
more than worth it. And today, I want to talk
about the consumer habits that we have that,
without realizing it, are leading us to
become depressed. Now, I want to be
clear here that when I use the word depressed
in this context, I'm speaking more colloquially. For some people, it may
aggravate clinical depression. But for others, we're talking
about a feeling of malaise, a feeling of inadequacy,
a feeling of insecurity, a feeling of despair even
about the current circumstances of your life or your
financial situation or what you happen to have. We talk a lot on TFD
about spending money in ways that actively
bring you joy, in ways that are truly valuable to you. And while that is going to
look differently for everyone, it is very important
to get a clear sense of the kind of
discretionary spending that is actually paying
emotional dividends. Maybe for you, a
bouquet of fresh flowers every week is something
that genuinely brings you a great amount of joy and makes
every day feel a little bit more special, maybe especially
if you work from home and see them all the time. But you could also
be someone who's buying flowers out of habit
and barely notices them. But we're not really
here today to talk about the wasteful spending,
so much as the spending, or more generally, the
consumer habits we have that are actively working
against our mental health. And while not all of
them may apply to you, they are all shockingly
common in our culture, especially for younger
people, and in some cases, especially for women. If nothing else, it's
worth taking a look at just how normalized
some of these behaviors and their negative consequences
have become in our culture. So without further ado,
five consumer habits that are making you depressed. Number 1 is watching haul
videos on YouTube or TikTok. Now, if there is one type of
content that, I have to say, is just a complete net negative
from every angle on our culture and on our mental
health as a society, it has got to be the
phenomenon of haul videos. They are incredibly
popular here on YouTube. They become more and more
popular every day on TikTok. And basically, as a concept, it
is a creator, usually a woman, showing all of the
various items that she bought at a given store or
in a given period of time. And sometimes these are highly
aspirational, featuring luxury brands, where the person is
spending tens of thousands of dollars in a
given shopping trip. But more common
in the haul video phenomenon is hauls
from stores that are more accessible
to the average person. And if you're buying
in large quantities, that usually means fast fashion
or otherwise very unethically and cheaply made products. Now, you could make
the argument that when you're talking about
a bunch of items from a new season, let's
say of a clothing store, it is a more convenient way for
someone to get a look at all of the various new
items on offer, on an actual human body
without having to scroll through an e-commerce website. And there are
certain haul videos that don't have the same
negative underpinnings because, basically, the only
way to shop at these stores is in haul form. I'm thinking, of course,
about grocery stores. We've even done a video on
this very channel about what the same grocery haul will cost
at several different grocery stores. But let's be clear. If you're going
to a grocery store and just buying a couple
of items at one time, you are absolutely
doing it wrong and probably spending more
money in the long run. But for the vast
majority of haul videos, we're talking about shopping
in a way that is neither particularly adapted to any
budget-friendly lifestyle or sustainable on any
sort of environmental or even personal level. And while the implications of
a video in which an individual took 500 of their own dollars
and bought a bunch of clothing at Fashion Nova isn't great
from several different points of view, it becomes
all the more insidious when you realize that a
lot of these haul videos are not even being paid
for by the creator. Many haul videos,
especially for clothing, are sponsored by a
specific brand, which means that those influencers
are rarely paying full price or even at all for
those products. In fact, they're
often getting paid. Usually, the brand
gives the influencer a budget, like 10
items or $1,000. And the influencers
get to pick which items they want for a haul video. And on top of that,
they will often get paid a flat
fee for making it. And if you click
one of the links in their video description
to buy something, they're probably
getting a commission on that too, which is
more often than not not properly disclosed. So not only are they not
paying for the clothes, they're actually making
money from the haul videos. And in many cases, the viewer is
none the wiser about any of it. But when you look at the
kind of consumer habits that haul videos are basically
designed to normalize, the idea of buying one or two
new items in a given season seems ridiculously low
and as though you're depriving yourself. There is undoubtedly a
chicken-or-the-egg phenomenon here. But when you connect the
haul video phenomenon, which has been around for about
15 years, to the extent to which fast fashion has given
rise to up to 52 micro-seasons in a given year of
clothing, you start to understand the dynamic
in which we're all being trained to think that
constantly acquiring new items and acquiring many of them
is the normal way to shop. And feeling like you can't
keep up can be a major bummer. Studies show that
comparing ourselves to the flawless highlight reel
that we see on social media can lead to feelings of
inadequacy and depression. And when we forget that
those people are literally getting paid to look perfect
because they often don't even disclose it properly, it
can tank our mental health. And a perhaps less
nefarious but arguably more ubiquitous phenomenon
is the hashtag #OOTD, or Outfit Of The Day trends. This is something
I have participated in every now and again
myself, not using the hashtag, I don't think. But in any case, the
concept is the creator is showing you just a picture
of what they're wearing. They'll often tag
the various brands or give more details
on the outfit. But on its surface, the idea
is pretty straightforward and honestly, even
before social media, nothing particularly new. This is what I'm wearing
today, not that complicated. But there was a massive surge
of outfit-of-the-day videos on TikTok in August of
2021, during rush week at the University of Alabama. It was a nonstop deluge of
18-year-old girls in designer brands and expensive
pieces specifically chosen to impress their
sorority of choice. And while it was a fascinating
look into a bizarre subculture of Americana, it was
also an example of why outfit-of-the-days
can really bum us out. The problem with many of these
videos or even still photos is that they are often
being explicitly curated in a way that is not realistic. They're picking their
most expensive items, assembling outfits that are
completely impractical to wear to different scenarios, or
wearing special occasion outfits that are being passed
off as an everyday look. And for those creators
who do this on an almost everyday basis, it
heightens the pressure to never wear the
same thing twice, leading to overconsumption
and the perception on behalf of the viewer
that wearing the same thing frequently is
abnormal, when that's the basis of most
functional wardrobes. The culture of
things like hauls, micro-seasons within
fashion, outfits of the day, and always wearing
something new bleeds into the mind of the average
social media user to the extent that many of us don't even like
posting photos on our own grids if we've already been
posted in that outfit. Objectively, this is ridiculous. Right? Everyone knows we wear
the same things sometimes. But the culture
of always needing to impress and give the
impression that you have something fresh on
on a daily basis has been so normalized in
these viral videos and photos, as to fundamentally alter
our perception of how our wardrobe should look. And similarly, number 2 is
obsessing over luxury items. Luxury brands are entering
new platforms like TikTok to reach younger consumers. Gucci's videos regularly
surpass a million views each. And it is working. A survey of millennials
revealed that they spend an average of $500
per month on luxury items. 51% said that they
would forgo healthcare in favor of luxury goods. And this is especially
upsetting when you consider that people
with chronic health issues are at a higher
risk for depression. And not having health care would
only exacerbate that problem. Who are you guys? Literally, who
are the people who are spending $500 a
month on luxury items and would forego healthcare
in order to buy them? I assume these people exist. But get right with God. Now, let's also be clear
and put an asterisk that the fact that people even
can choose between healthcare and anything else is wrong. Healthcare is a human right. We're the richest
country in the world. Give people healthcare for free. We're the only developed
country in the world where it's not a thing
to just have healthcare. What is wrong with us? We deserve better. Get it together, America. We spend more per
capita on healthcare than any other country that
has universal healthcare. Bernie Sanders 2020, he can
still pull this one out. Medicare for all. And listen, I am
all for spending extra on an item that
is of high quality if it is going to mean a lower
cost per use in the long term or in other ways significantly
improve your quality of life. That is true of many things. For example, if you're
buying something like a good pair of leather
shoes or a nice coat, often going for the
nicer, higher quality, better assembled item
is going to result in having to replace it less,
having to repair it less, and generally getting a lot
more use out of the item. Similarly, ever since I switched
to my Dyson vacuum cleaner, a.k.a. my son, a.k.a. my husband,
I have never looked back. I love vacuuming. I really need to do it though. I've been gone for a month. That was gross. But listen, get a Dyson. You'll know what
I'm talking about. But it is important to remember
that just because something is expensive or
has luxury status or is marketed in an incredibly
effective and luxury-adjacent way, does not mean that
the product is better, or that it's better
for your life. To quote The Gay and Wondrous
Life of Caleb Gallo-- Sometimes, things that
are expensive are worse. Ultimately, luxury
marketing, whether it's for a vacuum cleaner
or a $3,000 bag, has to go above and
beyond appealing to the actual functionality
of whatever the item is you're buying. According to Forbes,
luxury brands operate under the assumption
that their customers are already getting
their basic needs met. They can afford rent. They have food in the fridge. And they're ready
for something bigger. So luxury brands promise to
meet our higher-level needs, such as respect,
self-esteem, and achievement. Luxury advertising is full
of A-list celebrities, private jets, fabulous resorts. And it insinuates
that these things can be part of your life too. In other words, a
designer purse won't just hold your keys and phone. The story is that you will
earn the respect of others and become part of
an elite community when you carry a luxury bag. You may even achieve
self-actualization. But the truth is that, in
reality, almost no product is going to be able to live
to this insinuated promise of becoming a better person
or living a fundamentally different life. There is almost always going
to be a delta between what you expect that owning that
Chanel bag will do for you and what it actually
does for you, especially if it means a huge hit to
the rest of your budget. And that delta between
our expectations and our reality in any
given decision or experience is often what leads us to acute
feelings of disappointment, shame, regret, longing, and even
feeling worse about ourselves than when we started. Because at least before you
bought the Chanel purse, you could say to yourself, well,
once I have that Chanel purse, I'll be that person I've
envisioned in my head. Now you're just you
with a Chanel purse. Number 3 is impulsive
or compulsive spending. Impulse spending, it comes
in many forms and frankly, is more normalized than we'd
like to think in our culture. I mean, whom among
us hasn't made a joke about not being able to
leave Target without spending $300 in a fugue state? Jury's out if it's
fugue state, but I'm going to keep saying fugue. And while it is easy to be
funny and relatable with talk of overspending and
compulsive ways, it is very much not a
joke in our culture. According to Psychology Today,
80% of compulsive buyers being women. And there's a lot of overlap
between compulsive buying and addiction. And the temptation to
buy stuff is everywhere, with the average person seeing
up to 10,000 ads per day. And these aren't just
random ads for stuff that isn't relevant to you. Companies have gotten
terrifyingly good at understanding exactly who
you are, how to market to you, and what you want to buy. You can look at a
product one time, and it will follow you
around the internet for weeks, which makes it
very difficult to resist the temptation. But side note, guys,
get your algorithm together because
the number of times that I have bought
an item, and then I have seen that exact same
item for weeks after the fact. It's like, I have the trash can. I can't buy it again. Fix your algorithm. And when you're
shopping online, so many of the normal barriers to
making purchases you otherwise wouldn't are totally removed. You might have
before been thwarted by expensive shipping, a long
wait on delivery, or a drive to the store. But now, you can get
pretty much anything you want shipped
to you very fast for very cheap, which is
part of the reason why one of the biggest and
most important tips is to, at minimum, remove
all of your card information from your browsers so that you
at least have the tiny barrier of needing to get up and
go get your wallet, which can be more effective
than many of us think. And with so many opportunities
to impulse or compulse spend, we are more and more susceptible
to the horrible cycle that it creates in
terms of mental health. We get a rush of excitement when
we purchase, which has a name. It's called buyer's
high and which can be extremely
addictive and is often followed by buyer's
remorse, which is often felt when we buy
an item we probably couldn't afford or knew
that we didn't need. And what's a great
way to get rid of that nagging
feeling of remorse? Getting back on that high
again and buying something new that, this time, we
think will fix the problem. Regular impulse
spending has been shown to decrease overall
ambient levels of happiness, which can make you even
more susceptible to chasing that buyer's high. So it's important
to remember just how dangerous this
cycle is and just how much brands are
constantly trying to keep us sucked into it. Number 4 is spending
money because your friends are spending money. We talk a lot on TFD about
cultivating a social circle that is not only adapted
to your financial lifestyle but fundamentally
very empathetic and understanding about
your financial needs and limitations. If you're not comfortable
saying it's out of my budget to a friend, you are
often going to be drawn into spending
tons of money you can't afford, while feeling
like shit about yourself in the process. In fact, 27% of
millennials have reported feeling uncomfortable
saying no when a friend suggests an activity
that they can't afford. And according to a 2018
Credit Karma/Qualtrics survey, 48% of millennials admit
to overspending, even going into debt, to keep
up with their friends. And this pressure to accept
our friends' invitations, when they want us to go
to a nice dinner or even on a fancy vacation,
is only compounded when we know that we
are going to live out every single moment
of what we're not able to do on social
media should we decline, which many often refer
to as FOMO spending. And this can be the Fear Of
Missing Out on a night out or even just a sweater
that your friends are pressuring you to buy. This FOMO spending can be
so great that about half of millennials
have reported going into debt because of FOMO. And because it is such
a stigmatized reason to have gone into
debt, as opposed to things like student
loans, most people who are in debt for these
reasons keep it a secret. And the irony is
that racking up debt you do not feel
you can talk about is more likely to create
feelings of isolation in you. And what happens when
you feel isolated? You want to connect with
your social circle, which can increase the pressure to
make it seem like everything's normal. You're not drowning
in credit card debt, and you can totally afford
to go to the bar with them after work. But maintaining an
image that is not true to our financial reality
is the most dangerous consumer habit of all, which brings
us to our last point. Number 5 is going into debt
to fuel a specific lifestyle. A few years ago, the
internet went nuts over a woman named
Lissette Calveiro. Lissette was working
in marketing and PR when she decided to try her
hand at being an Instagram influencer. But being an Instagram
influencer isn't cheap. Lissette was constantly buying
new clothes so that she never had to repeat an
outfit and going out for acai bowls to
get a perfect photo. Eventually, she started
springing for designer bags and plane tickets to create
the illusion of a dreamy luxury lifestyle. But her income couldn't keep up
with her influencer spending, on top of her everyday expenses. Lissette racked up $10,000
of credit card debt while trying to achieve
her influencer lifestyle. And this is an extreme example. But it is more and
more common to feel that they have to spend at
least some money in order to maintain certain images
fueled by social media. The level of visibility
into our lifestyles that social media provides is
unprecedented in human history and extends the
pressure to impress our social circle and
immediate connections, which has always
existed, into the need to impress tens,
hundreds, even thousands of people we may not even know. According to a survey
by Chase, millennials are willing to spend
more money if it meant that they would
get a better Instagram post out of it. And 90% of millennials
say that social media causes them to
compare their wealth and their material
possessions to their peers. Ultimately, we'd
likely be lying if we said that we don't think
about the image that is being projected about
us on our social media. And it is sometimes
hard to parse out what spending decisions
are influenced by that need to impress
versus the spending decisions that we otherwise
would have made anyway. A good litmus test, though,
is challenging yourself not to take photos
of certain things if you're worried that you
may overspend because of it. Because ultimately, all of
these various consumer habits are leading us into a
very dangerous cycle. Repeatedly spending beyond
your means leads to debt. And the average American has
$15,950 in credit card debt. And 39% of Americans carry
credit card debt month to month. And debt can lead
to a downward spiral when it comes to mental
health, with 40% of people in credit card debt
reporting that it has had an effect on
their mental health. And when you combine debt
with sky-high interest rates, it can create a feeling
that you will never escape your cycle of debt, which
results in stats like people who are struggling
to pay off debt being twice as likely to
report depression and anxiety. Ultimately, any
one consumer habit can be enjoyed in
moderation and be part of an overall healthy
holistic relationship to your finances and
your mental health. But it's important to check
in with ourselves about how we feel when we hang out
with a certain friend, or we see an ad
for a certain item, or we watch an outfit-of-the-day
video from an 18-year-old who's wearing all
designer labels. I was getting that stuff
marketed to me on my Instagram Reel Explore page. And I was like, is
life not hard enough? It's 2021. We are almost two
years into a pandemic. Do I need to be bombarded with
a gorgeous 18-year-old wearing Prada? Probably not. We need to check in with
not only how we're feeling, but also the habits that
this might be creating in us. However, having a strong
relationship with our budgets, tracking our spending closely,
and generally focusing more on our goals and what we're
able to save than what we're spending on in a given
month are great firewalls to some of the worst tendencies
that these phenomena can bring on. None of us are totally immune. But we can build up a much
better financial immune system. As always, guys,
thanks for watching. And don't forget to hit
the Subscribe button and to come back every
Monday, Tuesday, and Thursday for new and awesome videos. Goodbye.
