 "Shoppers cross Sixth Avenue in the Manhattan borough of New York City. Many in the US are turning to retail therapy to cope with Donald Trump’s landslide election win. Representational image/Reuters")
Donald Trump swept to victory in the United States presidential election on November 5, triggering a wave of grief among Democrats.
In the aftermath of Trump’s win, some have taken to buying dystopian books , others started googling how to ‘ leave the country ’, while some women took the more drastic step of swearing off dating and marrying men .
Amid these emerging trends, comes another — doom spending in which Americans are self-soothing by shelling out cash. However, this comes with a nasty financial hangover.
What is doom spending?
Before we delve into how Americans are doom spending after Trump’s election, here’s what it actually means.
Doom spending is the practice of spending money to soothe fears about broader issues like politics or the economy. Some describe it as Gen Z’s version of retail therapy. Kimberly Palmer, a personal finance expert at NerdWallet told HuffPost, “Doom spending describes the impulse to spend money on things to self-soothe against anxiety and stress. “For example, if we are really stressed out about the election, we might splurge on takeout, new clothes and a plane ticket for vacation just to help boost our mood.”
Some other experts define doom spending as buying things we would normally not spend money on because we are feeling emotionally charged — like sad, mad or scared.
Dan Ariely, PhD, social scientist, author and professor of psychology and behavioural economics at Duke University, told Today.com that doom spending is a way to feel in control. “We buy stuff sometimes to feel a sense of control. We’re living in a period of high uncertainty, so shopping is one way to feel like you’re able to decide autonomously.”
How are Americans doom spending now?
The short and simple answer is Donald Trump. Worried about a return of Trump to the White House, many Americans, especially the younger generations are opting to doom spending.
A report by Intuit Credit Karma reveals that 27 per cent of shoppers in the US are doom spending. The report said that the habit is more prevalent among younger generations, with 37 per cent of Gen Zers and 39 per cent of millennials saying they do it.
More than a third, 36 per cent, of respondents in the survey said that they can’t rationalise saving money due to feelings of uncertainty about the world and economy. That jumps to 47 per cent of Gen Z and 43 per cent of millennials.
Speaking on the same, Courtney Alev, consumer financial advocate at Credit Karma, said, “Shoppers might be looking for a sense of control, especially in a time period where it feels like so much is out of your control.”
One such example of a doom spender is Celeste Acevedo. She posted a video of the purchases she made from Sephora, saying it was “an anxiety response”. In her video on TikTok, she lists the items as “things that I bought in the Sephora sale to cope with the election.”
“Hope people are doing well and coping well,” she added. Incidentally, she spent over $261 on cosmetics based on the products shown in the post.
A separate TikTok post showed a woman buying Christmas decorations and scented candles, captioning it: “When you’re sad about the election so he takes you to your fave (sic) store and tells you to get whatever you want.”
Such videos have started trending on social media with another US woman holding five shopping bags with the caption, “Post-election depression called for retail therapy and spending it on winter clothes and holiday décor.”
The election results are also contributing to doom spending, note experts. Courtney Alev, consumer financial advocate at Credit Karma was quoted as saying, “We expect a lot of young Americans to spend much of this next week online, scrolling social media, as they continue to digest election-focused content. Doing so could lead to even more charged feelings and drive further spending.”
“Those who are upset with the results may spend to make themselves feel better, and those happy with the results may spend because it feels like a reward,” she added.
Why is doom spending financially dangerous?
While doom spending may not sound fiscal risk, it is a dangerous practice to follow, as it can lead to bigger financial woes. Hanna Grichanik, a financial advisor at Northwestern Mutual, told HuffPost, “Doom spending can have both a short- and long-term impact on financial goals. It’s very easy for someone to fall into debt when impulse buying because they’re deviating from their budget.”
Doom spending can also be particularly concerning for young Americans who are already experiencing debt growth at faster rates than other generations. Data from the Federal Reserve Bank of New York revealed that credit card balances reached a whopping $1.14 trillion in the second quarter of 2024.
Ted Rossman, a senior industry analyst at Bankrate, told CNBC, “The share who pay in full now is actually the lowest in four years.”
Doom spending is also prohibiting the young from making important milestone purchases.
How does one curb doom spending?
The first step to curbing this practice is being self-aware. Financial experts also add that one should take a break from social media in order to stop doom spending.
They add that instead of scrolling online, they should opt for watching a movie, starting a new hobby or spending time with loved ones. Kimberly Palmer said, “Instead of doom spending, find other ways to get that much-needed pick-me-up. You could meet a friend for coffee or a walk, get outside and in nature, or call a family member. Reconnecting with other people and with nature without spending money can all be ways to give yourself a low-cost mood boost.”
Others also added that if there’s a temptation to spend money, then one should make space in their budget for such purchases.
With inputs from agencies