Self-Help Organization for the Chronic Over$pender

An aspiring clinical psychologist says she may be helping to identify and treat a growing American ailment--overspending.

Nancy Liela Wallace, who is doing her internship at the Westminster Center for Personal Development in Pasadena, theorizes that overspending just might be an addiction and therefore subject to treatment.

Wallace has studied addictions at International College in Westwood, where she is a doctoral candidate in clinical psychology. In the three years she has worked as a counselor, overspending has emerged as a serious problem for about 25 of her clients, she said.

Binge-Buyer Herself

Wallace, who admits to having been an occasional binge-buyer herself, has formed a self-help group for “spendaholics,” which she hopes will provide further evidence that overspending can be treated clinically. Meetings are held at the Westminster Center; fees are based on a client’s ability to pay.

The idea of offering psychological help for compulsive spenders is relatively new. An informal Times survey of psychologists and credit counselors identified only one similar program, a San Francisco-based project founded by a woman who says overspending helped land her in prison.

In interviews, several therapists and family counselors said compulsive spending has been appearing with increasing frequency among their clients. Many viewed overspending as addictive, and they lauded efforts to find solutions to what they termed a potentially large-scale social problem.

Sandi Gostin, founder of the San Francisco program, got the idea for her group while serving a one-year term in the Women’s Correctional Facility at Frontera. She said she was convicted in 1976 on charges of embezzlement and went to prison in 1983 for violating parole.

Destructive Spender

After telling her story of destructive, uncontrolled spending on several Bay Area television and radio talk shows and in newspaper interviews, Gostin said she was contacted by at least 500 people who wanted to discuss their own spending problems.

The result was $pendMender$, a nonprofit organization for compulsive spenders. The groups she founded in San Francisco and Lafayette attract from 10 to 50 people each week. They pay Gostin $5 to attend each session, she said.

Wallace and Gostin have not met or even heard of each other, but their findings have many similarities.

Both have concluded, for instance, that overspending usually comes in the guise of some other problem and that compulsive spenders frequently have difficulty with relationships, work, drug dependency or excessive drinking or eating. They may feel out of control, that money governs them the same way alcohol and drugs control other addicts, the group leaders said.

Many overspenders also tell of hiding secrets: shoplifting, falsifying documents, bouncing checks and of being hounded by creditors, Wallace and Gostin said.

Both also contend that overspenders often are bright, educated, successful, upwardly mobile people who present a curious dilemma to those who work with them: They are often so far in debt they look at counseling as a luxury they can’t afford and go on spending and increasing their feelings of powerlessness.

They all suffer from low self-esteem, behavioral scientists agree. However, even within this framework spenders express a wide range of feelings and ways they handle them.

Some spender personalities Wallace has identified are:

--The superperson, who feels compelled to do, support and provide for others; the savior of all who are in financial need.

--The Cinderella who clings to youth by believing Prince Charming will appear to save her from financial ruin.

--The adolescent whose rebellion never ends, demonstrating that he or she can’t be told what to do with money.

--The undeserving who must get rid of money fast in order to get on with being poor. Some in this group are burdened with images of their suffering poor parents.

Subconscious Anxiety

More typical, she said, are:

--Binge buyers who spend to relieve subconscious anxiety.

--Status seekers who need confirmation of their worth from their peers.

--Fearful people who keep their partners insolvent as a way of holding onto them.

There are others as well.

“If you could get (all the varieties of overspenders) to clasp hands, they’d stretch mall to mall between here and San Diego,” said Richard Hogan, a founder of Psychological Services Group in Cerritos.

Hogan, a clinical psychologist for 30 years and author of a text on psychotherapy, said overspending surfaces as a secondary issue among some of the 200 clients he sees during an average year.

Clients, Hogan said, “use overspending as an acceptable coping device and they’re not self-critical about that. They don’t see this as a problem that is serious in their life style, and it stays in the closet for a long time.”

‘Undisciplined Personalities’

Donna Fong, executive director of Consumer Credit Counselors of Los Angeles, calls overspenders “undisciplined personalities.” Fong, who heads Los Angeles’ largest nonprofit service for people in debt, identifies overspenders as mostly men and women under 40 who are subject to peer pressure, credit card overuse, flashy advertising that encourages indebtedness and changing values.

The agency, which is funded by businesses and foundations to provide free workshops and low-cost personal counseling for people in debt, had 924 people in its debt repayment program in 1984, nearly double the 495 it served in 1982, Fong said.

“People don’t feel badly” about indebtedness, Fong said. “They think it’s the norm. It’s now accepted . . . there’s no disgrace in filing for bankruptcy. That’s even considered a smart thing to do.

“The people we see just don’t sit down and balance their books. They just don’t want to think about it,” she explained. “These are not older people, who lived in more of a cash society. This is a generation that grew up with credit cards, and with television urging them to spend.”

Wallace’s group, $penderMender$, and Consumer Credit Counselors use some of the same techniques to effect changes. They ask victims to forfeit credit cards, to budget, to keep records of their spending and receipts of all purchases.

Wallace and Gostin also encourage talking. Gostin invites speakers from consumer organizations to speak to her groups; Wallace uses psychotherapeutic techniques to encourage clients to identify inner feelings that lead to addictive and destructive outer expressions.

Someone to Talk To

“There should always be someone to talk to,” said Gostin, who believes most overspending stems from early childhood experiences.

It usually continues for many years before the problem is acknowledged, Wallace and Gostin said. Often a crisis--such as a broken marriage or eviction--will prompt the overspender to seek help.

Because groups and treatment are still in the pioneering stage, no statistics on treatment results are available.

Fong of Consumer Credit Counselors said it takes her agency from 2 1/2 to 3 1/2 years to effect long-term change in its clients. Gostin said “a lot of our people got it together” in less than a year, and Wallace cites two examples of clients who have gotten out of debt and stopped charging on their accounts, also within a year.

Liane, who requested that her last name not be used, is a San Francisco artist who said she has benefited from $penderMender$ and psychotherapy.

After attending the group meetings, Liane said, she notified her friends that they would get just one Christmas present from her--”instead of the usual four or five--or 10.”

In Therapy for Years

“I’m obsessive about pleasing people,” she said. “I’ve been in therapy for years, but nobody hit on spending because it’s been so hidden.

“I feel like I’m in the way if I ask for anything, but it’s all right for my friends to leech off me. I get all my clothes in thrift shops, but someone with a new hair style and I. Magnin clothes will ask me for money and get it. You might not believe this, but it took me two years to buy a new toothbrush for myself. The bristles were falling out, but I was giving $5 to every derelict who asked, because I believed he deserved it more than I.”

Liane is now 39 and her life has changed, she said.

“I have hope now. Part of the problem was not knowing I had a problem,” she explained. “I’m white-knuckling it. I go unconscious about money. It’s like an overeater eating or a doper doping. I can’t even trace where my money has gone. But at least I’m aware of it now and I’m not alone. I always thought I was alone.”