This article is written by Emily Dorman, Financial Wellness Coach, part of Career Money Life’s Supplier Community. You can view the original article on Emily’s website.
67% of Aussie Gen Ys experience FOMO (fear of missing out). 67%!!
As a Gen Y myself, I know this fear of missing out is fuelled by social media, peer pressure and in part our own expectations of what is our rite of passage as a Gen Y.
Social media has a massive impact on FOMO. All those glamorous stars and friends doing amazing things. Doesn’t it just make you green with envy? Sad your life isn’t as exciting? What many of us don’t see or forget is that social media is everyone else’s highlight reel – the best of the best – not real life.
Let’s explore how FOMO affects spending.
FOMO spending is when you spend money on things or experiences because you don’t want to miss out. Be it attending a festival, dinner with friends or the latest clothes.
In a US study of 1,045, 18-34-year-olds, 39% of respondents said they have gone into debt to keep up with their friends. And worse still is that 73% of those who went into debt to keep up with their friends, keep it a secret.
Respondents said they did this mostly due to social anxieties such as:
- 36% spend money they don’t have because they’re afraid they won’t be included in a future activity if they don’t
- 27% don’t want to feel like an outsider
- 26% don’t want to lose friends
- 23% don’t want to be judged.
What they may not realise is that their friends could feel the same way. Two-thirds of respondents feel buyer’s remorse after spending more than they had planned to on a social situation that they later regret. 36% of respondents doubt they’ll be able to sustain this lifestyle for another year without going into debt.
If you give in to FOMO and spend more money than you have and go into debt or don’t save money for the future – it is future you that will be impacted.
Your lifestyle. Your future dreams. Your future happiness.
Every dollar you spend today is one dollar less you have for tomorrow.
How do I know if I FOMO spend?
Think about the last few months and how you spent your money:
- Where did your money go?
- How did you feel when you spent your money?
- Was there any peer pressure or fears driving spending decisions?
- Did you find yourself buying things you already have because…?
- Did you go into debt to make purchases?
- Are you paying off credit card debt each month?
The answers to these questions will help you start to see if you are FOMO spending – that is spending because you don’t want to miss out and you want to fit in.
If you are finding yourself putting living expenses like groceries on credit because you brought that festival ticket or went out for dinner one too many times this month then it’s time to take a serious look in the mirror.
THIS IS NOT SUSTAINABLE. And will only result in you having major FOMO when you can’t afford it keep up anymore, or worse being totally embarrassed when the credit card company comes knocking on your door.
Emily Dorman shares some tips on how to combat FOMO spending. Read more on her blog.