When you hear peer pressure, your mind probably goes to the high school kid being pressured into wearing LA Gear high tops because everyone else was doing it or skipping school to look cool. But it’s also a very adult problem. We call it keeping up with the Jones’s. They buy a new car, you buy a new car. You buy a boat, they follow suit. Sometimes it’s that extreme and sometimes it’s as simple as joining your friends on a dinner date at a restaurant that doesn’t fit your budget. You don’t say a word, because the social pressure to dine with your friends is an unspoken norm many adults pretend doesn’t exist.
Trying to live someone else’s financial life when you are in an entirely different financial place can cause all sorts of trouble. Instead of making financial decisions based on what will be best for you and your family, you start doing things based on what others will think. You buy a bigger house than you should so you’re in a neighborhood near your friends. You take that vacation you can’t truly afford. You host parties outside your budget because you want to impress your friends. The ramifications might not seem that big, but they can have a snowball effect that can land you in a world of debt and take years to unravel and correct. So how do you stop peer pressure spending? How do you stop caring about what the Jones’s think? It seems like an easy fix, but a much harder one to follow through with. Here are some tips that might help:
1. Figure out your why. Why are you saving money? Why are you on a strict budget? Are you saving for retirement? To send Johnny to college? To remodel the kitchen. Discuss your why often and keep it in the forefront of your mind. When something so personally important drives your spending choices, you are more likely to pause before making a purchase you can’t afford. Keep your eye on the prize!
2. Be honest. There is no shame in setting a budget and talking about it. We so often feel a weird sense of shame if we are being frugal and our friends find out. We’re afraid of what others think of us. Clearly I let that go a long time ago because my goals for my family were more important than what others think. So I talked about it. I was very open about it {well obviously since the whole world can read about it!}. I didn’t lose friends by being more open about it, I allowed my friends to feel more comfortable opening up about their savings goals. You might be surprised at how many people are playing the peer pressure spending game, and all it takes is one person to say enough before you realize you’ve all been playing it. It’s a relief to be honest about where you are financially. There is NO shame in that!
3. Ditch the friends who aren’t on board. If you’ve been honest and you have friends who aren’t supportive of that, it might be time to put some space between you. I’m not saying go drop your friends who have more money than you like bad habits. That’s crazy talk. But if your friends can’t respect your goals, it’ll be hard to maintain said goals around them. Let’s say you decide to take a couples trip. You’ve been upfront about your budget and planned out all your excursions, but when you get there they want to upgrade your entire trip, take spendy excursions, eat at restaurants out of your budget. I bring this up because this happened to a friend of mine recently. They ended up vacationing alone most of the trip because they couldn’t afford the trip their friends were on. Chances are, they won’t vacation with those friends again. And that’s okay. Find people who support your goals or are on a similar financial path and stick with them!
4. Be firm with your entertainment budget, but have one. Saving doesn’t mean you can’t have fun, but make sure you stay within your budget. If you want to go to that fancy dinner with friends or take that vacation with your family, save for it and make sure it’s within the budget. Then, once it’s set, it’s set. The whole family has to be on board with that. If there isn’t money left, you simply have to decline those invitations {or suggest a cheaper alternative like having couples over for dinner at your house for a potluck}.
And there are just a few ideas. Do you have any tips? Have you fallen into the peer pressure spending trap like most Americans have at one point or another, or do you do you without a second thought? Have any tips for those struggling with that?
~Mavis
Jenny Young says
Being open with your friends is really the best way to go. You might find out they’re struggling as well & would rather do fun things together for less.
Also, if you plan the activity you can control the budget a little better. Choose a potluck or picnic instead of eating out for example.
KC says
Yes to the “if you plan the activity, you control the budget” (at least to some degree!) – we used to be able to feed probably 12 people for less than it would have cost for two peoples’ meals at the not-fast-food-but-not-expensive restaurant, although of course then you’ve got the dishes and cooking to do. But even if it’s just proposing the $10/plate restaurant instead of the $50/plate one, or coffee/dessert instead of a meal, that can make things a lot more doable.
It can be socially challenging, though, if there’s a celebration event (birthday, wedding shower, whatever) organized by someone else with a required chip-in amount (and please, y’all, if you’re organizing a shower or a birthday party, be upfront about the actual costs, rather than saying “a small amount” or something, so that people can figure out whether or not your “small amount” fits in their budget). Yes, I’m happy for my friends! But no, a weekend “destination” bachelorette party structured around an income level that is not mine is not a feasible way of expressing my congratulations?
But yes, being up-front about your restrictions is really helpful, when it works – and better than debt in any event!
Angela @ Tread Lightly Retire Early says
I’d say the “why” is probably the very most important part – as long as you have a clear goal on the why (for me it’s being financially independent by 45), it’s much easier to keep spending in check.
Also – finding awesome things to do that don’t cost much/any money. We just came back from 4 1/2 days dispersed camping in eastern Washington and spent almost no money since the camping was free and we had to plan ahead to bring all our food since we were out in the middle of nowhere. It was an AMAZING trip and we probably spent less money than if we had stayed around home instead.