Financial FOMO

Part of any healthy habit is having the guts to speak our truth in tricky social situations. "Thank you, Grandma, but I don't need a third piece of pie." Whether it is our diet, mental health, or financial health, we need to be able to tell others what works for us and what doesn't. The best budgets die when their keeper falls victim to everyday FOMO (fear of missing out). Succumbing to social pressure to "come with us," buy what is "on trend," or go where "everyone is going," is one of the quickest ways to kill our long-term financial dreams.

In my conversations with young professionals, I have been surprised by the number of questions that all boil down to a variation of, "How do I know how to spend money?" Or, when they're being really honest, "How do I resist all the pressure I constantly feel from others and society to spend?" The more I get this question, the more I see just how crushing social and media pressures can be. The pressure to fit in has always been intense, but social media has amplified it to a point where common-sense messages struggle to get through.

For many, the pandemic was the excuse they needed to reduce spending and increase savings. Here are tips to establish these habits when external excuses don't work.

Focus on Purpose

Focus on the purpose of whatever it is you are considering. Is it to visit and spend time with friends? If so, can that only be accomplished with an expensive dinner out, or could it be a pizza in the park? Look for alternatives that accomplish the same purpose. You don't have to be a senior citizen to enjoy a walk through the mall without buying anything. Great fun can be had with a deck of cards or a frisbee.

Get Comfortable Saying the Uncomfortable

Those awkward moments while out with friends or family are easier when we get in the habit of speaking our truth about our finances. As a young professional recently told me, "You don't have to have a drink with dinner. It took me too long to figure this out, but I have just as much fun, sometimes more, when I don't have a drink with dinner." This is one of many ways to save while out on the town.

Of course, this only saves you money if you each have separate bills. "Separate checks please" is a great phrase when ordering at a restaurant. It saves you time and money. You only pay for what you want, and you don't have to divide the bill and Venmo later. It is a phrase that will come in handy throughout your life. This simple statement makes your intention clear and usually puts the others at the table at ease too.

A little overspending on a night out may not seem like it is worth the awkward moment, but consider it practice for when the big-ticket items come up. We need to practice ways to honor our financial priorities while being gracious and kind. "That sounds amazing. I would love to join you for that concert/big game/trip, but right now my priority is a savings goal I set," is a great way to show gratitude while sticking to the promises you made to yourself. Another version is, "I love the features of the new cell phones, but right now a new phone isn't a priority for me. I'm going to hold out for another version or two." We can stick to our priorities without being judgy or critical of those who choose to spend their money differently.

Play 'Would You Rather'

Ultimately, the day-to-day financial choices we all make come down to a game of would you rather? The faster you learn how to play, the more often you'll win financially. For example, I would rather drink plain coffee with cream every day, so I have more money to spend at the salon. You may rather have a daily triple shot cappuccino and skip the salon. So, ask yourself, would you rather drive an older vehicle with no car payment or have a newer vehicle with a monthly car payment? Not every choice is this simple, but when boiled down, most financial choices come down to this basic question, "Would I rather have THIS, or have THAT?" As long as you stay within your means, there is no wrong answer, just financial preferences.

Asking yourself a few would you rather questions can also help you better define your goals. With clear goals the answers become easier because you have a clear objective for the last half of the question. I would rather spend less on ____ so I can have _____. The fear of missing out is greatly reduced when you have a clear vision of the goal you are working toward.

Joey Beech is a personal finance speaker and the author of A Girl's Guide to Personal Finance. You can connect with her at JoeyBeech.com or linkedin.com/in/joeybeech/.

Read More Articles >>