When I started working for myself, I worked on an old desk in the corner of our bedroom. We lived in a flat in central London so having an extra room for a home office wasn’t really an option. After a few months of working at this old desk, I decided that I needed an upgrade. The drawers were too narrow to hold my notebooks, the desk was too low for me to cross my legs under, and my computer chair was too wide for me to get close enough to comfortably type from the desk. It was an ergonomic nightmare. I needed a new desk..
After browsing online I found the perfect white desk. I ordered it and was beaming when it was assembled. I quickly went out and got a new desk chair to match, a pillow, a vase for flowers, a throw blanket to use for the chilly afternoons, and new knobs for the drawer handle.
It was perfect.
I happily typed away at the desk for a few days until I realized that it didn’t quite work with the rest of our room. The desk was a shining, bright white, glorious piece of furniture. The rest of the room was brown wood furniture that had moved with me from business school.
It was fine for a student, but the duvet was looking a little tired now next to the desk. It would be quick to update that. A little more browsing online and I had picked a new duvet but faced another problem. Our bed. I was pretty over the frame. I should find something just a bit more fun. After a quick stroll through a furniture store, I promptly fell in love with a grey velvet tufted frame (I swear it’s pretty). Luckily, it was a great price!
And well, you know where this is going. A new rug, a new dresser, painted nightstands, a new bed frame, a new duvet, new sheets, a new plant for the corner, new lamps, new curtains, and new throw pillows. We have a brand new room and it all started with my desk.
How did that even happen?
The Diderot Effect
This, I learned, is a prime example of the Diderot Effect. In the essay, “Regrets from parting with my old dressing gown”, French philosopher Denis Diderot tells the story of how a beautiful new dressing gown eventually plunges him into debt.
Compared to this new dressing gown, everything else he owned seemed tired and didn’t live up to the glamour of his new item. He began replacing all of his items with updated, more expensive pieces. The theory is that when you get a new item that is completely different to what you currently own, it will lead you into a consumption spiral.
So that new $250 desk I bought had suddenly sent me into a spiral of purchases that ended thousands of dollars later.
I don’t regret completely refurbishing our room. But now that I realize what happened, I wish that I would’ve made a more conscious decision to redecorate.
How to stop the spiral
Realize it’s happening
Had I realized that I was spiraling out of control the second I pressed purchase, I could have taken a step back and pressed pause. Maybe I did want to update the furniture in our room, but I haphazardly falling into it probably wasn’t the best way to do it.
Stick to your uniform
A few weeks ago I was inspired by Sherry from Young House Love to clean out my closet and create a uniform. She has an amazingly small number of items (seriously, look at this) and swears that having a uniform saves her money and time. Even though I didn’t have a ton of clothes — I’ve done Marie Kondo’s Spark Joy method — I still found myself taking too long to get dressed every day.
I created my uniform and as I was looking at what I was getting rid of, I noticed that most of these purchases came from a spending spiral. I’d buy something a little out of character for me and end up purchasing five other pieces to wear with it. And they’d rarely be worn.
I’m not an adventurous dresser, so for me, it’s better to buy things that stick to my uniform of clothes.
A uniform doesn’t have to only be related to clothes. It can be buying furniture that fits into your existing scheme, new plates that match what you’ve already got going on with your glasses and silverware
If you have a uniform (ie: if you know what you like), buy more of that.
Set yourself a spiral budget
I had set myself a budget for the desk and I shopped very mindfully with that budget in mind. But somehow, when it came to all of the extra items, those didn’t actually factor into any budget anywhere. I spent the money and it wasn’t until months later when the room was finished, did I add up how much it all cost.
I wanted a new desk and I was excited to have a functional space for my new work from home endeavors. Next time I’ll anticipate that there will be other things that are going to find their way into my cart and give myself a budget for any of these spiral purchases.
Don’t let money dictate your taste
Researching ideas for how to stop the spending spiral I came across the idea of horizontal wealth. This comes from author Terry Prachett who astutely observed that there are two types of wealth: vertical and horizontal.
Vertical wealth means doing what you think you should do just because you make more money. “I am rich. So I had better do what rich people do.”
Horizontal wealth means not letting your income dictate your tastes. “You like books and no you have money? Buy more books!
I love this idea because it’s not telling you to never spend your hard earned money. Spend it, but spend it on the things that actually matter to you, not what you think should matter to you.
If you don’t let money dictate your tastes the spending spiral may never be a real issue in your life.
THE LATEST & GREATEST
This post was originally published on April 5, 2018, and updated on August 1, 2019 I’ve written a lot about opening a Vanguard 529 because even before Henry was born, college costs were weighing heavily on my mind. And for good reason: costs are skyrocketing...read more
How much do your work and your paycheck influence your idea of your self worth? Anyone who has gone through a job transition, been in a career rut, or found themselves out of a job probably knows the struggle of tying their own personal worth to their job. As Jordan...read more
One of the best things you can do for your money is to create multiple income streams. Creating multiple income streams can give you a safety net in case you lose your job. Or, in our case, it’s giving us the security we need to sell everything we own, move around the...read more
Erica Gellerman, CPA
Erica Gellerman is a CPA, MBA, personal finance writer, and founder of The Worth Project: a weekly money newsletter you actually want to read. Her work has been featured on Forbes, Money, Business Insider, The Everygirl, The Everymom, and Lifehacker. When she's not writing about personal finance you can find Erica exploring Europe from her temporary home base in London.