Some people get into dept by buying things they don’t need and can’t afford. What are the reasons for this behaviour? What action can be taken to prevent people from having this problem?

Nowadays a phenomenon of buying unnecessary and unaffordable things by taking a bank loan is widely spread. This situation is caused by the promoted ideology of consumerism as well as favourable credit terms in the banks. Tightening of the credit conditions and enhancement of the financial literacy could be preventative measures. Last decades market relations have led to the problem of excessive consumption. Our lives today are overwhelmed with uncountable offers of various products and services. Social media propagates luxury lifestyle. Such preconditions stimulate people to aggrandize their possessions. Furthermore, attractive credit terms that banks offer today provoke to fulfil aspirations and buy these possessions by getting into debt. For instance, the most popular bank in Kazakhstan designed an application extremely convenient for various operations with personal finance. At the same time this application includes the online store where all the products can be bought on credit with one button click. Since the era of consumerism is unlikely to end anytime soon, the corrective actions list is limited. One of possible solutions is the loan restrictions. Government should force the banks to tighten the credit conditions in order to make them less attractive. Financial literacy and knowledge of personal finance management could have corrective effect as well. For instance, every enterprise could provide the finance training courses to its employees. To conclude, consumerism ideology and attractive bank offerings have led to thoughtless spending. The governmental actions aimed to restrict the credit terms and promote the financial literacy of the population could rectify the situation.