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The Dangers of using Spending as a Reward

Are we digging our own financial graves "treating ourselves"?

“Treat Yourself.” It’s a very common phrase these days. And it can mean a variety of things. Either you should indulge because everything’s been going very badly and you deserve something positive in your life. Or, and this is the most used version: you should reward yourself because things have been going very well indeed.


That new pair of shoes you’ve been eyeing up, but secretly find way too expensive. Well, you had an excellent week at work. Closed two deals, had a very satisfied client and even attracted several new clients (I don’t know man, I’m an academic, can you tell?). As imaginary (and unrealistic) as this may be, you’ve had an excellent week!

You’re on a roll. Going through life like a #winner! What happens when you see these boots now? Oh, you’re going to want those. And why shouldn’t you have those? You’ve had a great week. Did so great at work. You deserve them! And before your bank account has even realized it, you are now the proud owner of these (too expensive) boots. If you’re not a member of Shoe-aholic Anonymous like me, just pretend I’m talking about some cool tech stuff.

This scenario must sound familiar to you. Even if you’re not rolling in money and “treating yourself” constitutes of buying yourself an extra coffee or a muffin with your regular coffee, instead of buying Louboutins or VR headsets. Regardless of the size of expenditure, what you’re doing is spending additional money to celebrate a win. And that can very quickly become a toxic relationship.


Why is this relationship so likely to be toxic? Well, let’s dive into the basics of one of my old favourites: conditioning. Operant conditioning.

Operant conditioning is a deeply psychological concept where four different applications of reinforcement and punishment (positive, negative) can lead to very different behavioural outcomes.

Let me exemplify all four:

  • To positively punish someone is to add a negative stimulus. This can take the form of torture, or, slightly less extreme, make them do chores, or repent in general.

  • To negatively punish someone is to take away a positive stimulus. This can take the form of grounding your kids (taking away freedom) or taking away their mobile phone because they broke curfew.

  • To negatively reinforce something means to take away a negative stimulus. This is often the most difficult one to exemplify, but think of painkillers. If you have a headache you take a painkiller which (hopefully) takes away the negative stimulus (pain). If the meds work, you will take them again, if they don’t, you won’t bother next time your head hurts.

  • To positively reinforce something means to add a positive stimulus. This is what we will be focusing on here. Although it is mainly the act of spending I want to dive into deeper.

Spending in itself can be a very addictive act. If spending money, which to a lot of people is a very abstract concept, can give you the joy of something new you really want (a very concrete concept), than that in itself is grounded within positive reinforcement. Through operant conditioning we build habits. And if every time you do something worth celebrating you know you’ll be able to buy yourself something you want, well, that’s one hell of a habit!


Now trust me, I’m just as guilty of this as the next person. If I think I did good, I too want my reward. That’s literally how we animals are programmed. However, it’s not the operant conditioning that lies at the heart of this problem. No, it’s its older evil sister: classical conditioning.

Classical conditioning was proposed and proven by Pavlov. Yes, the one with the dog, the saliva and the bell. That one. How does dogs drooling as soon as someone rings the doorbell relate to you spending too much? Well, let’s dive a bit deeper into habit formation.

When we move away from operant conditioning and move into classical conditioning, we no longer look at the association with rewards and punishment, we simply look into associations. Through your spending habit, you have build a (very strong) association between doing something well and immediately spending money. Now as soon as you have done something well, something that in your eyes deserves to be celebrated, you will almost feel the urge to grab your wallet, phone and keys and run out to the next store. That’s not healthy.

You know what it feels like to buy something. It’s great. The feeling of success. The feeling of having a new product in your life. It’s all just too much to bear.

It might be too much to bear if it turns out that in your period of sheer ecstasy you hit overdraft…

For one, states of bliss, confidence and general victory are not great states for doing your finances. You overestimate your own ability and you underestimate how much longer that money is going to have to last. Secondly, if you’ve got a multitude of good days in one month will you be able to afford to keep this habit up? I don’t think you will be… At least, I’m highly doubtful.

Is it worth giving yourself an extra reward, if it means hitting below 0 a week later? These are questions you need to ask yourself.


If this is you, don’t worry it’s me too. But it’s time we build a much healthier habit around reward and positive reinforcement. There has to be more to life than buying new shoes (or tech, whatever). I seem to constantly lack the time to actually sit down and watch a series. Why not let that be a reward? In those 45 minutes I spend sitting I could have also run to the store and bought myself some new shoes, but the sitting down is giving me equal enjoyment, and is a lot cheaper!

All in all, you should be able to “treat yourself” if you’ve done well. Yes, I’m all for reinforcing great behaviours. Just don’t reinforce them with things that could reinforce other, more toxic behaviours...


Behavioural Science

Personal Finance



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