Proceedings of the 2023 2nd International Conference on Public Service, Economic Management and Sustainable Development (PESD 2023)

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The Impact of Irrational Behavior on Decision-Making in Personal Finance

The Role of Emotion Attachment in Installment Debt

Authors
Chang LIU1, *
1University of California Irvine, Irvine, USA
*Corresponding author. Email: liu_chang200110@163.com
Corresponding Author
Chang LIU
Available Online 10 January 2024.
DOI
10.2991/978-94-6463-344-3_61How to use a DOI?
Keywords
Emotion; Emotion Attachment; Installment Debt; Irrational behavior
Abstract

Emotions play a significant role in debt-driven consumption made by individuals leading them into irrational behavior that can result in substantial financial issues if not appropriately controlled. There exists a correlation between emotional attachment towards product/service purchases via loans & irrational spending practices among most people struggling with debt burdens because, over time, they feel the need to keep up with the emotional bond they have created. This can lead to a cycle of debt where consumers use additional credit, loans, or borrowing to sustain their current lifestyle choices. In this paper, we discussed several methods that help consumers avoid these negative consequences. People need to take proactive measures such as educating themselves on personal finance management and creating realistic budgets based on their income levels while considering long-term sustainability factors rather than temporary satisfaction only. By doing so, they can manage their emotional attachments effectively without compromising future financial stability while avoiding common pitfalls associated with overspending through credit purchases or other forms of loan repayment plans due to misleading information through marketing campaigns or peer pressure influences.

Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the 2023 2nd International Conference on Public Service, Economic Management and Sustainable Development (PESD 2023)
Series
Advances in Economics, Business and Management Research
Publication Date
10 January 2024
ISBN
10.2991/978-94-6463-344-3_61
ISSN
2352-5428
DOI
10.2991/978-94-6463-344-3_61How to use a DOI?
Copyright
© 2023 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Chang LIU
PY  - 2024
DA  - 2024/01/10
TI  - The Impact of Irrational Behavior on Decision-Making in Personal Finance
BT  - Proceedings of the 2023 2nd International Conference on Public Service, Economic Management and Sustainable Development (PESD 2023)
PB  - Atlantis Press
SP  - 544
EP  - 553
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-344-3_61
DO  - 10.2991/978-94-6463-344-3_61
ID  - LIU2024
ER  -