Digital wallets fuelling massive impulse spending
Digital wallets are facilitating a staggering amount of impulse spending, data suggests. Here’s what we’re splashing out on, on a whim.
According to research by comparison site Choosi, 44 per cent of Australians sometimes use a digital wallet to pay for their everyday transactions.
Most digital wallet users (51 per cent) have them linked to their debit card, while 23 per cent have them linked to their credit card and a further 19 per cent have them linked to both.
The biggest perceived advantages are contactless pay when buying in person – an increasingly appealing feature during the pandemic – and not having to carry a separate card or a chunky wallet or purse as they are always carrying a mobile phone.
Online transactions are also proving increasingly convenient thanks to features like auto filling payment details.
This ease and speed means many Aussies are splashing out on unnecessary goods.
“For most it makes it all too easy to spend without thinking about it,” Choosi said.
About 40 per cent of digital wallet users indicated they were more likely to order takeaway food or to impulse shop online.
“Some also report being more likely to do things like get a ride share (28 per cent), buy a coffee (27 per cent) or buy impulse food treats (27 per cent),” Choosi said.
Encouragingly, many feel digital payments allow them to more easily track their spending than with cash, while 20 per cent indicated they were more likely to contribute to “round up” savings.
These are mobile apps such as Wisr that allow you to round up the cost of purchases, with the rounded up amount deposited to a nominated account.
Banks that currently offer round up accounts or similar features include Bank Australia, ING, P&N Bank, Up Bank and Great Southern Bank, Canstar’s finance expert, Steve Mickenbecker, says.
To help Australians improve their financial literacy, Choosi shared some tips from Whitely Bradford, who specialises in financial literacy at Griffith University:
* Learn to want less. When you adapt your mindset to wanting fewer material things, you tend to spend less and you can become more conscious about how you spend your money.
* Read personal finance books (e.g. Total Money Makeover by Dave Ramsay, Sort Your Money Out: And Get Invested by Glen James) and listen to podcasts (e.g. My Millennial Money and She’s on the Money).
* Speak to a money coach or financial adviser, or find a mentor – someone who has been successful financially and you can learn from their success and failures.
* Play around with online calculators that can help you with debt repayment, superannuation and retirement. A great place to start is the ASIC MoneySmart website.
Originally published as Digital wallets fuelling massive impulse spending
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