How to Identify, Treat, and Prevent Credit Card Addiction – Written by Ellen Gans

Let’s cut to the chase: compulsive shopping and credit card addiction are genuine problems, and they’re more common than you may think. If you suspect that you suffer from a compulsive shopping and/or credit card addiction, it’s important that you understand two things:

  1. You are not alone.
  2. There is a way out.

This article isn’t a substitute for professional counseling, but if you follow the steps laid out in this article, you’ll be well on your way to gaining control over your credit card use.

Do you have a credit card addiction?

How do you decide when your credit card use has crossed the line into compulsive behavior?

Consider the following list, which cites just a few of the potential red flags in the area of shopping and credit card compulsion. If any of these apply to you, then you may suffer from credit card addiction.

  • Frequent, unnecessary purchases
  • Hiding purchases from spouse or other close family members
  • Holding several “maxed out” credit cards
  • Frequently paying only the monthly minimum

Less acute red flags might signal you’re headed down the path toward addiction — not to mention a lot of debt. These signs include:

  • Using credit for everyday items — and not paying off the balance every month
  • Frequent balance transfers to avoid maxing out cards
  • Ignoring credit card statements
  • Skipping one credit card bill to pay another
  • Relying on credit cards to buy things that aren’t in your budget
  • Having past due accounts

Does any of this sound familiar? If so, your purchasing habits may qualify as an addiction. Don’t feel ashamed. This is an opportunity to take charge and turn things around.

Your brain on credit cards

Let’s take a moment to discuss the science behind spending addiction.

First of all, it’s important to understand that shopping and credit card addiction can often be concurrent with a variety of other psychological disorders, such as depression, anxiety, drug or alcohol addiction, or ADHD.

So what’s going on in the brain of a compulsive spender?

Are you ready to get really “science-y”? An MIT study found that when people were asked to place bids on NBA tickets using either cash or a credit card, the people using credit cards “bid twice as high as the cash crowd.”

Crazy, right? Maybe not. Here’s an explanation: There are two parts of the brain involved in spending decisions. The part that loves the rush of purchasing is called the nucleus accumbens, and that “rush” you feel is dopamine.

The part that feels twitchy about parting with money is called the insula. Typically, the insula helps mitigate the chance that we’ll fork over a big wad of cash unless it’s absolutely necessary.

But there’s a problem: for some reason, our brains aren’t wired to think of cash and credit cards the same way. In other words, the insula doesn’t know what to make of credit cards. Perhaps that’s why it’s not as “painful” to whip out the plastic as it is to hand over a stack of bills.

Those credit card dollars may not feel as “real” to our brain, so we still get the dopamine rush of making a purchase, but we don’t get the push-back from the insula. The result: we spend too much money.

Let’s look at it from another perspective. It’s safe to say that, when faced with a purchasing decision, you have two options: a) spend the money now, or b) save it for later.

Why is spending it now so much more appealing for so many of us? It turns out that it may simply be the way our brains are wired — we’re primed for instant gratification. Now more than ever, we want things right away. And with all the technology available today, we’re used to getting things right away. That feeds right into the parts of our brain that prefer immediate payoff over long-term gains.

In general, according to research published in Newsweek, “pleasure now is worth more to us than pleasure later.” But there’s more to it than that. Some people are apparently wired to be “spenders” as opposed to “savers.”

That’s right. It might be your brain telling you to spend that money. The Newsweek report notes that scientists “are discovering measurable differences in the brains of people who save and those who spend with abandon, particularly in the areas of the brain that predict consequences, process the sense of reward, spur motivation, and control memory.”

If you combine the tendency to spend now and the ease and simplicity of flashing a piece of plastic, then you have a recipe for serious problems.

We mentioned earlier that some people make an association between shopping/credit card addiction and other addictive behaviors. Jason Hull mulls over this connection based on his own experiences with credit cards. “Some people can try a drug and never become addicted, and some try it once and become hooked.”

Hull got hooked on using credit cards to make purchases that he couldn’t afford. It wasn’t until he approached it like someone who was addicted to a substance like drugs or alcohol that he could overcome the battle. That meant removing stimuli and having an “intervention” in which someone else had to take full responsibility for his money in order to prevent him from exposure to the addictive behavior.

How to Overcome a Credit Card Addiction

Hull’s method to overcome credit card addiction worked for him, but there are other strategies to consider. We’ll take a look at several strategies, broken into short-term strategies that you can employ right away, and long-term strategies that can be developed over time.

Short-term strategies

  • Cut up your credit cards
    • Putting them in your sock drawer isn’t enough; they need to be inaccessible. Note: do not close the accounts; this can hurt your credit score. You can keep one credit card for emergency use.
  • Create shopping lists every time you go out shopping
    • This includes retail shopping. If you only need a shirt for a special event, you should only buy that one shirt. Many people make grocery lists but don’t think to make lists for other shopping trips.
  • Wallet-free shopping
    • Can’t bear to go without shopping? That’s okay — just leave your wallet at home. You can browse to your heart’s content, as long as it doesn’t cause stress or anxiety since you can’t buy anything.
  • Start tracking your spending
    • You may be stunned at how seemingly innocent purchases add up (like those $5 lattes every morning). Make a spreadsheet and track every penny you spend. No excuses.
  • Find a substitute
    • If you’re tempted to spend money, replace the compulsive behavior with a positive behavior. Maybe indulge in your favorite (library) book or go for a walk instead. (Exercise is often the best way to curb compulsive behaviors.)

Long-term strategies

  • Join a support group
    • There are many support groups available for spenders, and opening up in front of others about your addiction doesn’t have to be an intimidating, formal situation. Many groups meet regularly over an (inexpensive) meal or gather to share stories and positive advice with people facing similar obstacles.
  • Set goals
    • Everyone deserves the security of an emergency fund. This is money you can draw on in case of unexpected expenses without relying on your credit card. Set a goal of setting aside money for your emergency fund as well as money to pay off debt.
  • See a therapist
    • Addictive behaviors are often deeply rooted, and an expert is often required to get to the bottom of the issue. Don’t be afraid to ask for help. It’s not a sign of weakness — in fact, it’s one of the strongest moves you can make.
  • Meet with a financial counselor
    • A financial counselor can help you develop tailored strategies to get back on track and move forward with healthy financial habits. It’s hard to overstate the value of a good financial counselor, so seek recommendations and find a reputable counselor with whom you click.

Credit card and shopping addiction is common, but it can be devastating. There’s a snowball effect that can grab hold and won’t stop until it has taken you — and your loved ones — down with it. This isn’t simply dramatized talk; shopping addiction has destroyed many lives.

The first step to recovery is recognizing the problem. The next step is doing something about it, and doing it consistently. Fortunately, you don’t have to face this problem alone. Ask for help and rally your resources. You can do this.

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