The psychology behind reviewing expenditure
You might already know about utilities and insurance comparison websites but why do we not get around to using them? Most advertising is based on ‘saving you money’ which sounds like a no brainer. However, it’s still going to cost you more time, effort and energy than just doing nothing. So, how do we break free from our inertia?
Behavioural research shows that by reframing this from ‘doing this will save £x’ to ‘doing this will stop me losing £x of my hard earned money unnecessarily’, can increase our propensity to act by around 300%. For example, think about a time when you have misplaced or lost a £10 note. How did that make you feel, and how much energy did you expend trying to find it? Compare that with, for example, a £10 lottery win that took little time to go back to the shop to collect.
By applying that mindset to your regular expenditure think ‘how much am I losing due to not getting the best deal’, this will give you the push you need. Especially if counted in units of something you like. For example, instead of money, how many bottles of wine am I missing out on because of my apathy?