FOMO & Social Media's Ruining Our Finances
Looks like we have another reason to take a break from social media, and it’s because of our wallets. Namely, a new survey found that people are spending too much money, and they believe it’s because of wanting to imitate others on social media.
A 2019 Modern Wealth Survey by the Charles Schwab Corporation conducted an online survey asking 1,000 Americans about their saving habits, spending habits, investing habits, and outlook on money.
The results found that more than a third of Americans admit to spending money on unnecessary items and vacations. They say they did so because they saw others doing the same on social media. All of this was because they didn’t want to miss out on the fun.
“The burden to ‘keep up with the Joneses’ has been part of our culture for decades, but it appears that social media and the fear of missing out (FOMO) have increased the pressure to spend,” said Terri Kallsen, executive vice president and head of Schwab Investor Services. “Spending is not the enemy, but when we allow social pressure or other forces to lure us into spending beyond our means, it can impact long-term financial stability and become a larger problem.”
Friends And Our Money
Survey respondents by large saw social media platforms as the worse influence for financial decisions. That said, they believed that their family and friends were the best influences. It seems people think of social media as a whole to be the problem and not the other people using it.
That said, respondents were awfully concerned with what their friends were doing with their money. The survey found that three out of five Americans paid more attention to how their friends were spending than how they were saving. Of course, no one posts on social media how they decided not to go out clubbing in order to save for rent.
An equal number of respondents then said that they don’t know how their friends can afford the expensive vacations, meals, and tech that they’re posting about on social media. And let’s be real, they can’t. A lot of Americans are just shuffling around money and then getting stressed out when the big bills come along.
Spenders & Planners
The results also found that 59 percent of respondents consider themselves to be spenders. But, the other numbers don’t exactly agree. 59 percent live paycheck to paycheck. Then 44 percent have some sort of credit card debt, only 38 percent have an emergency fund, and most say they spend almost $500 on “non-essential items.”
For those feeling stressed out by these numbers, don’t worry. You’re not alone. But, there is a way out. The survey also found that financial planners considered themselves to be more stable than the rest. In fact, only one-third of people who don’t plan said they feel comfortable with the state of their money.
Ultimately, this survey’s showing us that we have yet another reason to spend less time on social media. They are great services for connecting and networking, but they’ve also created this atmosphere of needing to spend money and live big when we can’t afford it.