Ever made a big, impulsive purchase only to feel instant regret, guilt, and an uneasy knot in your stomach? You’ve probably experienced buyer’s remorse.
In this guide, we’ll uncover three major purchases that often lead to buyer’s remorse, explore why this happens, and provide strategies for making smarter purchasing decisions moving forward.
What Is Buyer's Remorse?
Buyer’s remorse is that gut-wrenching regret you feel when you realize you’ve spent money on something you didn’t need, didn’t want, or can’t afford. It can gradually creep in as the excitement of the purchase fades and reality sets in, especially when your credit card bill arrives.
From a psychological standpoint, buyer’s remorse stems from cognitive dissonance—an internal conflict when your mind acknowledges that the purchase wasn’t the best choice, but you’ve already committed to it.
Buyer’s remorse can also manifest physically, causing symptoms like sleeplessness or anxiety when checking your bank account. Some people will find themselves constantly justifying the purchase to themselves or others. If unresolved, this feeling can lead to prolonged mental stress that lasts months or even years.
The Big Three: Major Purchases That Trigger Buyer's Remorse
Here are three large purchases that commonly trigger buyer’s remorse:
1. Buying a house
“I wasn’t ready for home ownership.”
Buying a house is often seen as an essential milestone and sign of responsible adulthood. Many people feel pressured to buy a home because their peers are doing it or because their family members are constantly asking about it. This societal pressure can make you feel like buying a home is something you need to do, even if you’re not ready.
I’ve worked with many clients who regret buying a house because they didn’t feel financially ready for homeownership but did it anyway.
“I rushed into the decision.”
A common regret among new homeowners is rushing into the purchase without fully considering all the costs that come with owning a home.
The monthly loan payment may seem affordable at first, but hidden expenses like taxes, repairs, insurance, renovations, and the cost of furniture and appliances for your dream home can quickly add up. Before long, the house no longer feels affordable, and you find yourself worrying constantly about affording the payments.
“I can’t afford this house.”
People often get caught up in emotions when buying a home. The market may feel hot, a perfect house might get listed, or you may envision a large home for your future kids to run around in. However, when making a big decision like buying a house, shifting your budget to accommodate your dreams often leads to regret down the road.
How to prevent this
If you’re planning to buy a house, approach it strategically, with a clear understanding of your financial situation. Careful planning is essential if you want to avoid the regret of rushing into a major purchase.
Start by mapping out a realistic timeline and saving a solid down payment of at least 20% of the home’s value. Keep this money separate from your regular savings and emergency funds.
Before committing to a home, ask yourself if you’re ready to settle down and stay in one place for at least the next decade. Moving is often expensive. If you plan to travel frequently or live elsewhere within the next few years, renting might be a better option.
When considering a home purchase, account for all the extra costs—in addition to mortgage payments, taxes, and insurance, you’ll need funds for repairs and a comfortable buffer for unexpected expenses. If the total cost exceeds what you’re currently paying in rent, think twice and reassess whether homeownership is the right decision for you.
Already feeling buyer’s remorse over your house purchase?
If you’re experiencing buyer’s remorse about your home, all is not lost. Focus on what you can control. Start building an emergency fund for repairs, find ways to lower your monthly costs, or consider renting out a room to ease the financial burden. Taking actionable steps to address these issues can help alleviate your worries and stress.
Remember, feeling uncertain after a big purchase is normal. If the numbers work and you can afford the payments, try to give yourself time to adjust to homeownership.
2. Buying a car
“I can’t actually afford these monthly payments.”
Similar to buying a house, one of the most common mistakes when purchasing a car is focusing only on the monthly payments. The dealership or car salesperson might structure the payment to fit your budget, but it’s often stretched across a long loan term. As a result, you end up paying far more in interest than the car is actually worth.
“I didn’t think enough about the total cost.”
With a fancy car come additional expenses like premium gas, costly maintenance, higher insurance rates, and expensive replacement parts. These costs can quickly add up, leaving you spending far more than you initially expected.
“I spent too much on features that don’t matter.”
Many people make car purchases based on emotions rather than actual needs, especially since vehicles are often viewed more as status symbols than merely means of transportation. That shiny, new car with all the cool features and add-ons may seem appealing at first, but once the novelty fades, you’re left with hefty payments for things you don’t really need.
How to prevent this
Before you explore options for the car you want, write down exactly what you need in a vehicle:
- Do you need space for kids or large items?
- Do you frequently travel long distances and therefore need better fuel efficiency?
- How long do you plan to keep the car?
- Do you need advanced safety features for peace of mind?
Stick to your list and resist the temptation of extra features. By focusing on your non-negotiables, you’ll avoid overspending on unnecessary add-ons.
General tips for maximizing your car purchase:
- Choose a car you can keep for at least the next 8-10 years.
- Opt for something reliable with low maintenance costs.
- If you plan to drive a lot, research fuel efficiency to keep long-term costs down.
- Calculate the total cost of ownership, including monthly payments, insurance, gas, maintenance, and repairs. Ask yourself if you can comfortably afford this cost based on your current financial situation.
Already feeling buyer’s remorse over your car purchase?
If the purchase is recent, consider refinancing the car for a better rate or trading it in for something more affordable. Sometimes, taking a short-term financial hit is better than enduring years of stress and anxiety.
On the other hand, if you can make the payments and the car reliably gets you where you need to go, don’t let the “what-ifs” consume you. Instead, embrace your decision and focus on proper maintenance, which will extend your car’s lifespan and make it a more worthwhile investment in the long run.
3. Getting a degree
“My degree isn’t worth the debt.”
Many college graduates feel trapped by the weight of student loans as they step into the real world. At the time of enrollment, a $100,000 degree may have seemed like a necessary investment in securing a brighter future—especially with encouragement from peers and family members to pursue a certain career path.
However, when the repayment period begins, it can feel overwhelming. Balancing a modest entry-level salary with living expenses while managing a hefty student loan payment often leads to a sense of buyer’s remorse.
“I chose the wrong field.”
Some graduates regret choosing their major without considering its job prospects. While they may have followed their passion, they didn’t research the job market or evaluate starting salaries in their field.
After graduation, they often find themselves in roles unrelated to their field of study, while still having to pay off a degree that doesn’t support their current career path or financial goals.
“I went to an expensive school for no reason.”
Regret can also stem from choosing an expensive private school when a more affordable state school would have provided the same opportunities.
While the prestige of a fancy diploma might have seemed like a golden ticket to career success, that degree might not deliver the advantages you envisioned—and it certainly doesn’t justify the extra years of debt you’re now burdened with.
How to prevent this
If you’re a student considering a loan for your degree, start by researching the average starting salaries in your field. For example, if the average starting salary is $40,000 annually, but you plan to borrow $100,000, the math simply doesn’t work out. While passion and interest are essential when selecting a major, balance them with practical considerations to find a field that aligns both your interests and financial goals.
Apply for as many scholarships as possible, even smaller ones. Ten $1,000 scholarships add up quickly. Every dollar you avoid borrowing is money you won’t have to pay back with interest.
If finances are tight, consider starting at a community college or attending a state school if it’s more affordable. What matters most is how you take advantage and maximize your education—not the prestige of the school. You can always transfer to a bigger school later if you secure scholarships or financial aid. By attending a more affordable school, you can reduce debt while still achieving your educational goals.
Already feeling buyer’s remorse over your degree?
If you’re struggling with hefty student loans, consider exploring income-based repayment plans to make your monthly payments more manageable. If you’re working in public service, you may qualify for loan forgiveness programs that can ease your financial burden.
Most importantly, don’t beat yourself up for your educational choices. Your degree still offers valuable assets, including knowledge, qualifications, new perspectives, and the network of connections you’ve built. Just because things haven’t turned out exactly as you envisioned doesn’t mean your education has been a waste.
Instead, focus on leveraging the skills and knowledge you’ve gained to build experiences that give you a competitive edge. This can open doors to greater career opportunities, making the most of the investment you’ve made in your future.
Example of Buyer’s Remorse in Action
Buyer’s remorse can begin with a single impulsive purchase but quickly escalate into overwhelming financial stress.
For Emi & Antonio, the decision to buy an expensive ring they couldn’t afford set off a chain reaction, snowballing into overwhelming debts and leading to years of financial strain and anxiety.
[00:02:39] Before we were married, I always paid off my credit cards in full, and I made one decision that was the first time that I ever knew I wasn’t going to be able to pay off my credit card in full. And that was when we got back from our honeymoon.
[00:02:58] Her ring that I got her was a cheaper ring because I got what I could afford. It actually tarnished in the ocean. And so when we got back, I was like, you know what? I got to get her a good ring. I got to make sure that she’s taken care of. So we went to the store, we got her a good ring, one that I knew would last, and that was the first time I made a purchase that I knew I couldn’t pay back that month.
[00:03:20] Ramit: How much was the ring?
[00:03:22] Antonio: That one was, I think, 3,000.
[00:03:26] Ramit: And how long did it take you to pay that specific charge off?
[00:03:31] Antonio: It snowballed. I couldn’t even tell you. Yeah.
[00:03:47] Emi: The feeling of bad never stopped. We never got past it, but I don’t think there has been a day since then that we haven’t talked about finances or stressed about finances or prayed. It’s been a snowball effect since. We never moved on.
What might seem like a small decision at the time can snowball, affecting your financial future and creating stress that lingers for years. It’s a reminder to always take time for thoughtful consideration before making any big financial decisions.
The #1 Way to Avoid Buyer’s Remorse: Sleep on Your Decision
“Rash decisions are the best!”
Said no one, ever.
When making a large purchase, give yourself a concrete window of time in which to make your final decision. Sleep on it, let your thoughts settle, and evaluate the decision with a clear, rational mind. This simple step can help ensure you’re making well-informed choices that you won’t regret later.
Research what you’re buying
Doing research before making a purchase is a good practice for any spending, but especially for big-ticket items.
Before spending impulsively, take the time to learn about the product. Read reviews from other users, compare prices across stores and online platforms, and ask questions to understand exactly what you’re getting. If you know anyone who owns similar items, check in with them about any issues they’ve encountered.
It’s crucial to evaluate the true cost of an item, including any hidden expenses like maintenance, insurance, monthly fees, or replacement parts. For instance, when you buy a Nespresso machine, you’re not just paying for the machine; you’ll also need to factor in the ongoing monthly cost of coffee pods.
Create a pros and cons list
Before you make a purchase, create an objective pros and cons list. Writing down your list often helps you evaluate the decision clearly while avoiding impulsiveness.
Be unbiased and consider both practical and emotional factors:
Pros:
- Cost-effectiveness
- Functionality and usefulness
- How it improves your daily life
- Potential long-term value
- Emotional satisfaction (how it makes you feel)
Cons:
- Does it take away from other important goals or expenses?
- Will it add stress or strain to family members or relationships?
- Is this a purchase solving a real problem, or is it just feeding excitement over something new?
- What financial sacrifices are needed to make this purchase?
- Are there any hidden costs like maintenance or extra fees?
This simple exercise can help you evaluate whether the purchase aligns with your values and financial goals, making it easier to avoid buyer’s remorse later.
Evaluate your financial readiness
Before making a significant purchase like a car or house, take a close look at your bank account, savings, and overall financial situation. Ask yourself:
- Can I truly afford this?
- Will this purchase disrupt my other financial goals?
- Will I still feel comfortable making payments six months, a year, or five years from now?
- Will my emergency fund and retirement savings still be intact after this purchase?
- Am I still carrying credit card debt?
By honestly addressing these questions, you’ll gain a clearer insight into whether this purchase is the right move or not. If the idea of long-term payments makes you anxious or uneasy, listen to that instinct. Sometimes the smartest financial decision is to not make the purchase at all.
Other Ways to Avoid Buyer’s Remorse
Here are additional ways to manage your finances and avoid buyer’s remorse:
Practice conscious spending
When you know your values, it’s easier to keep your spending aligned with your priorities instead of being swayed by emotions or external influences. My Conscious Spending Plan (CSP) helps you focus on what truly matters to you, make mindful choices, and keep those impulse purchases in check.
Keep in mind that emotional purchases often lead to buyer’s remorse. If you feel pressured to buy something immediately, step back and allow time for the urgency to fade so that you can make a more rational decision.
If you want to build a mindful spending strategy, these guides offer actionable steps for reaching your financial goals:
Build healthy money habits and break unhealthy scripts
If you truly want to avoid buyer’s remorse, shifting your mindset to adopt healthier money habits is crucial.
Start by asking yourself whether you’re purchasing something because you genuinely want it or because you feel pressured to do so.
This reflection helps break impulsive buying patterns and encourages more deliberate decision-making. By becoming more aware of your motivations, you can make purchases that align with your true needs and values.
This process might be challenging, especially if you have a history of impulsive spending. However, by creating your own set of money rules and boundaries that align with your financial goals, you can break those old habits. This approach will help you achieve financial freedom and avoid regret over thoughtless purchases.
While it’s impossible to completely avoid buyer’s remorse, the ability to make wise spending decisions improves with experience and discipline. Mistakes are part of the process; plus, taking time to pause and evaluate purchases that don’t align with your financial goals can bring a great deal of clarity.
