Breaking Free from Overconsumption

Ahead of the fall semester, many companies are ramping up their efforts to squeeze out every last dollar of back-to-school profits. Yet with education costs sky-high and the cost of living continuing to rise, overconsumption can be severely detrimental for UTRGV students. To protect their wallets, Vaqueros must know what to watch out for when it comes to both corporate actions and their own.

Dave Jackson, finance professor and chair of the department of finance, theorizes that just under half of the student population knows how to manage money properly. He attributes this to the lack of personal finance instruction in our “consumerism-driven society.”

Corporations tend to jump on this general deficit of knowledge in both their advertising and store layouts. According to The Motley Fool, some retailers create a sense of urgency using “short-term, deeply discounted” prices in hopes buyers will purchase additional non-discounted items. In brick-and-mortar stores, retailers tend to place regularly priced products beside similar ones with inflated prices, giving the impression of a good deal. In addition, cheap extras laid out near checkout tempt customers with instant gratification. Free trials are another tactic to hook customers looking for a deal, since canceling tends to be more difficult than signing up. Many more strategies like these exist, but being able to recognize them is only half the battle. The other half comes internally by curbing the individual desire for excess spending and taking financially responsible action. Professor Jackson said that some Vaqueros take out all of their available financial aid and spend the extra funds on purchasing luxuries. 

“Even simple things, they go out and buy…programming calculators that cost three, four times what a basic calculator costs, and it doesn’t make your answer more correct. It just costs you more money.”

The main motivator for this habit is external influence. Students tend to prioritize this instant gratification instead of the long-term benefit of less debt out of a desire for acceptance or clout.

“People generally, and young people moreso, are influenced by peer pressure. A lot. [Students] go out and buy things they can’t afford to impress people who they don’t like, who don’t even care,” he said.

The solution is simple yet not very easy: refuse to purchase an item as soon as there is an impulse to buy it. After a couple of days, temporary wants will fade, allowing a more clear view of how much we wanted the new item.

Plenty of students also fall into another personal trap: they rely on payday loans–short-term loans with high interest rates–to pay education costs. This could land them in thousands of dollars in extra debt. Jackson urges students to consider other payment options. UTRGV offers a variety of opportunities to lighten the cost of attendance. These include grants, scholarships, and payment plans. Students with a family annual income of $125,000 or less who have unmet financial need may qualify for the Tuition Advantage Program, which eliminates a student’s tuition and mandatory fees if they are taking 15 or more hours in a semester. Scholarships are also an underutilized source of funds. Too many scholarships offered by the university and local organizations have gone unused due to a lack of applications.

In addition, students with a credit or debit card can sign up for monthly payment plans over the course of the semester. Computer science senior, Aurora Morales, is familiar with buying on impulse and offers her own advice to students. Her personal strategy is to plan purchases, if possible, such as writing a list before going shopping. If prior planning is not possible, she checks her bank account after the purchase to keep track of how much she spent and how much money she has left. Students keeping a watchful eye on their actions and the messages of advertisers can successfully avoid falling prey to overconsumption.

Jackson said, “There’s absolutely nothing wrong with buying the latest and greatest, but that’s if you’re actually able to pay for it. If you have to struggle to do it, go into debt to do it, that’s what makes it wrong.”