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You count your pennies, so why does your bank account always look so dismal at the end of the month?

Researchers say an accumulation of "exceptional" purchases may be to blame. A new paper in the Journal of Consumer Research shows that even though people may be good at keeping tabs on their day-to-day purchases, they routinely splurge on special, unbudgeted items, because they underestimate how frequently these events arise.

Consider, for instance, the last time your favourite band performed in your area. The ticket prices may have cost a small fortune, but hey, when's the next time you'll catch them? Then your TV set breaks down. Why not shell out a little extra for a sleek replacement? Next up: Your son's graduation. Surely you can't cheap out on a present.

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Such purchases are never-ending – and the costs add up.

"In each instance, it seems reasonable to make a budgeting exception given the special nature of the spending and the low likelihood that a similar situation will recur any time soon," the authors Abigail Sussman, a doctoral candidate of psychology at Princeton University, and Adam Alter, an assistant professor of marketing at New York University, wrote.

Among a series of experiments, the researchers asked 275 participants about their willingness to pay for exceptional items, like a bottle of champagne . The participants were willing to pay more when these items were presented separately than when they were presented all at once. In real life, they suggest, people tend to be similarly short-sighted.

So how can you reel in overspending? The researchers suggest creating a separate category in your budget, specifically for exceptional purchases. Keeping track of these separately may encourage you to reconsider your next splurge. Alternatively, they propose relaxing your existing budget categories to include exceptional items. For instance, instead of thinking of your Halloween costume as a special purchase, try categorizing it as part of your clothing budget. With time, recording such expenses may change the way you think about special purchases.

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