One easy trick to stop impulse purchases: Carry crisp, large bills



Want to spend less money without spending too much time figuring out how? Get some crisp, new bills from the bank.

Apparently, when we have them, we don’t want to let them go, according to the Journal of Consumer Research study “Money Isn’t Everything, but It Helps If It Doesn’t Look Used: How the Physical Appearance of Money Influences Spending.”

“People generally spend more when they have worn bills and spend less when they have crisp bills,” say the authors Fabrizio Di Muro and Theodore J. Noseworthy.

They spend 33 percent less, to be exact.

The authors think they know why.

“People actively seek to acquire and retain crisp currency because it affords a source of pride to be expressed around others; however, people actively seek to divest worn currency because they are disgusted by the contamination from others,” the study says.

The authors believe people take pride in spending their crisp bills in certain social contexts. There is some subconscious sense of pride in having, and spending, these bills. They don’t want to put dirty, mangled bills down on the table after a work dinner, but will get rid of them quickly when they’re alone.

People also spend less when given a larger denomination than the equivalent amount in smaller bills. The only exception is when that larger bill is dirty. Then people will actually break it rather than using crisp smaller bills. Crisp trumps big, but both are important.

These tricks may not constitute a real savings plan, but they might help curb small impulse buys.

See the entire study here: “Money Isn’t Everything, but It Helps If It Doesn’t Look Used: How the Physical Appearance of Money Influences Spending.”

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About Ilyce Glink

Author of 13 books, including the bestselling 100 Questions Every First-Time Home Buyer Should Ask. Writer of the nationally syndicated column, “Real Estate Matters.” Top-rated radio host in Atlanta. Writer for CBS Managing editor of the Equifax Personal Finance Blog.
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