Emotional Overspending: Nearly Half of Americans Admit It

Nearly Half of Americans Say They Emotionally Overspend, Survey Shows by Nerdwallet

By Brian Keaney · Feb 3, 2017 3 min read

Personal Finance

Why emotions push nearly half of us to overspend

A NerdWallet survey found that almost half of Americans say their emotions drive them to spend more than they can afford. Here’s what fuels credit card debt — and how to climb out of it.

The survey asked Americans about what they consider to be acceptable and embarrassing reasons for getting into credit card debt, the emotions that lead them to overspend and who’s responsible for solving the problem of credit card debt in the United States.

1 Emotions Can Drive Debt

Consumers get into debt in different ways, but Americans have their suspicions about the No. 1 cause of credit card debt. Six in 10 Americans say the most common reason for credit card debt is people spending more than they can afford on unnecessary things. Only 10% say the most common reason for credit card debt is that people’s income won’t cover necessities.

Whatever the reason, the accumulation of credit card debt appears to be heavily influenced by emotion. Almost half of Americans (49%) say emotions cause them to spend more than they can reasonably afford, with stress, excitement and sadness being the top emotions associated with overspending.

2 Embarrassing vs. Acceptable Reasons for Debt

While a large majority of Americans (86%) say there are acceptable reasons for getting into credit card debt, slightly more (87%) say they would be embarrassed if they went into credit card debt themselves.

The most acceptable reasons for going into credit card debt, according to the survey: emergency purchases (63%); medical expenses (61%); and covering necessary expenses during periods of unemployment (45%). The most embarrassing reasons: overspending on unnecessary purchases (69%); nonemergency travel expenses (43%); and cash advances (41%).

3 Some Say Consumers Could Use Help

More than 6 in 10 Americans (63%) say individual cardholders are the only ones to blame for credit card debt, and more than two-thirds (68%) say consumers could reduce their overall spending to cut credit card debt. However, many Americans believe that outside parties could take action to help reduce credit card debt.

Almost 2 in 5 (36%) say credit card companies could stop charging interest on balances, while a third of Americans (33%) say marketers could stop promoting products and services to those with less discretionary income. A smaller but significant number (10%) say the U.S. government could bail out consumers. Unfortunately, it’s likely that we’ll have to deal with our credit card balances by ourselves.

4 A Step-by-Step Plan to Get Out of Debt

Getting out of credit card debt is totally doable for most consumers by making a plan and sticking to it, even if it takes a long time. Steps to take to get out of debt:

Stop using your credit card, at least until you’ve cleared your debt and you’re able to pay your balance in full every month.
Make a list of your credit card balances with their interest rates.
Choose a payoff plan — either going from smallest balance to largest, or going from highest interest rate to lowest. The first option, known as the snowball method, helps create momentum, but the second saves you the most money.
Pay the minimum amount due on each card except the one you’re targeting; apply all extra money to that card. Once you have it paid off, move to the next card on the list and repeat the process.
Find extra money to put toward your debt with a combination of increasing your income and reducing your expenses.
Consistently pay down your balances until you’ve eradicated them.

5 More From NerdWallet

For more details and a complete methodology, see the full survey.

Erin El Issa is a staff writer at NerdWallet, a personal finance website.
Email: erin@nerdwallet.com.
Twitter: @Erin_El_Issa.

Billshark · Bill Negotiation Experts
Helping consumers and small businesses stop overpaying on recurring bills.

Frequently Asked Questions

What share of Americans say emotions cause them to overspend?

Almost half of Americans (49%) say emotions cause them to spend more than they can reasonably afford, according to the NerdWallet survey. Stress, excitement and sadness were named as the top emotions associated with overspending. The findings suggest that credit card debt is often driven less by necessity and more by how people feel when they spend.

What do Americans say is the most common reason for credit card debt?

Six in 10 Americans say the most common reason for credit card debt is people spending more than they can afford on unnecessary things. Only 10% say the most common reason is that people's income won't cover necessities. In other words, most Americans view credit card debt as a result of discretionary overspending rather than basic needs.

Which reasons for credit card debt do Americans find acceptable or embarrassing?

The most acceptable reasons for going into credit card debt are emergency purchases (63%), medical expenses (61%) and covering necessary expenses during unemployment (45%). The most embarrassing reasons are overspending on unnecessary purchases (69%), nonemergency travel expenses (43%) and cash advances (41%). Overall, 86% say there are acceptable reasons for debt, while 87% would be embarrassed by it.

Who do Americans think is responsible for solving credit card debt?

More than 6 in 10 Americans (63%) say individual cardholders are the only ones to blame, and 68% say consumers could cut their spending to reduce debt. Still, 36% say credit card companies could stop charging interest, 33% say marketers could stop targeting lower-income consumers, and 10% say the government could bail out consumers.

What steps does the article suggest for getting out of credit card debt?

Stop using your card until your debt is cleared, list your balances and their interest rates, then choose a payoff plan: smallest balance first (the snowball method) for momentum, or highest interest rate first to save the most money. Pay the minimum on every card except your target, applying all extra cash there, and find more money by raising income and cutting expenses.

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Nearly Half of Americans Say They Emotionally Overspend, Survey Shows by Nerdwallet.

A NerdWallet survey found that almost half of Americans say their emotions drive them to spend more than they can afford.

The survey asked Americans about what they consider to be acceptable and embarrassing reasons for getting into credit card debt.

Consumers get into debt in different ways, but Americans have their suspicions about the No.

Whatever the reason, the accumulation of credit card debt appears to be heavily influenced by emotion.

More than 6 in 10 Americans (63%) say individual cardholders are the only ones to blame for credit card debt.

Almost 2 in 5 (36%) say credit card companies could stop charging interest on balances.

Getting out of credit card debt is totally doable for most consumers by making a plan and sticking to it, even if it takes a long time.

For more details and a complete methodology, see the full survey .

Erin El Issa is a staff writer at NerdWallet, a personal finance website.

Almost half of Americans (49%) say emotions cause them to spend more than they can reasonably afford, according to the NerdWallet survey.

Six in 10 Americans say the most common reason for credit card debt is people spending more than they can afford on unnecessary things.

The most acceptable reasons for going into credit card debt are emergency purchases (63%), medical expenses (61%) and covering necessary expenses during unemployment (45%).

More than 6 in 10 Americans (63%) say individual cardholders are the only ones to blame, and 68% say consumers could cut their spending to reduce debt.

Stop using your card until your debt is cleared.

Billshark negotiates your bills for you — no savings, no fee.

Billshark helps lower internet, wireless, cable, satellite radio, and other monthly bills.

Our experts handle providers for customers and share updates throughout the process.

Customers pay only when Billshark finds savings on eligible bills.

1 Emotions Can Drive Debt.

2 Embarrassing vs.

3 Some Say Consumers Could Use Help.

4 A Step-by-Step Plan to Get Out of Debt.

5 More From NerdWallet.

Frequently Asked Questions.

What share of Americans say emotions cause them to overspend?.

What do Americans say is the most common reason for credit card debt?.

Which reasons for credit card debt do Americans find acceptable or embarrassing?.

Who do Americans think is responsible for solving credit card debt?.

What steps does the article suggest for getting out of credit card debt?.

Top 3 Apps for Finance: Manage Money & Build Habits.

Nearly Half of Americans Say They Emotionally Overspend, Survey Shows

1 Emotions Can Drive Debt

2 Embarrassing vs. Acceptable Reasons for Debt

3 Some Say Consumers Could Use Help

4 A Step-by-Step Plan to Get Out of Debt

5 More From NerdWallet

Frequently Asked Questions

What share of Americans say emotions cause them to overspend?

What do Americans say is the most common reason for credit card debt?

Which reasons for credit card debt do Americans find acceptable or embarrassing?

Who do Americans think is responsible for solving credit card debt?

What steps does the article suggest for getting out of credit card debt?

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Nearly Half of Americans Say They Emotionally Overspend, Survey Shows page context