Is FOMO sabotaging your finances?

If ‘fear of missing out’ (FOMO) is draining your bank account and crippling your saving efforts, you are not alone.

According to a study out of the US, nearly 40% of millennials spent money they didn’t have and went into debt just to keep up with their pals. Further, 73% of those who went into debt would keep it a secret from their peers.

So, why are so many young people getting into financially precarious situations instead of just saying no?

Well, the lure of FOMO is incredibly powerful and, in a world where social media broadcasts everyone’s highlight reels and makes us feel as though we are perpetually missing out, it’s no wonder we feel like we need to be splashing our cash to keep up and crucially, be seen to be keeping up.

For context, here are some classic examples of ‘fear of missing out’ that many millennials would be familiar with:

Committing to travel or holidays you can’t afford with friends or family because you don’t want to miss out.

Buying material things like clothes, bags, or cars because your friends have them and you want them too. It is very easy to fall into the lure of using Afterpay or zipPay to fund this inclination, which can be an incredibly slippery (& addictive) slope.

Simple nights out with friends that always end larger than they should… we’ve all been in the situation where we’ve woken up with a headache, a hankering for Maccas and a hole in our bank account… this is of course completely fine and a part of what makes life worth living (having fun - not the hangovers), but it’s all about moderation and being conscious of how much we are spending on nights out.

Concerts/festivals/fun things: unfortunately lots of rather fun things are also rather expensive… it’s just one of the cruel truths of the world. BUT, this doesn’t mean we have to go without, as we will discuss below.

It’s likely that most of us would have surrendered to one or more of the above temptations within our lifetimes and that is okay! BUT, to stay on top of our finances – which, if you’re reading this article, we think is probably what you’re striving for – it’s important we don’t give in to all of the above, all of the time. 

To get you started, here are a few quick tips to help you say no when you aren’t in a financial position to say yes, so we can finally get a handle on the FOMO habits holding us back.

Do things with your friends won’t empty your bank account.If your pal suggests heading out for brekkie but you don’t have a spare $20 to blow, suggest a stroll instead or have them over for a coffee. There are lots of social things we can do that don’t involve money, we just need to be a little bit smarter about it.

Switch off and tune it out.Social media is a huge cause of our never-ending need for more. If it becomes overwhelming, just tune out for a while, or consider deleting the apps from your phone so you’re not inclined towards the mindless scroll when you have a few spare minutes.

Get creative and save.
Coronavirus, for all of its devastation, has taught us how to manipulate time and get creative and crafty, just like when we were kids. Puzzles, homemade meals, cheese boards and wine nights in are all excellent ways to have a good time without spending all of your hard earned dough.

Budget for indulgent FOMO activities.
Allocate money for events you know will likely come up during the year, so that don’t blow out your budget when they do come up.

Upcycle and buy second hand.
Buying new is expensive and frankly, it’s a little overrated! Instead, spend a little time trawling Facebook Marketplace for items you want to get your hands on, or visit your town’s markets and op shops to nab some unique pieces of clothing/furniture. There’s a great sense of achievement that comes with scoring a bargain or finding something vintage that no one else has.

Be honest with your friends.
We need to be having conversations about what we can and cannot afford. If they are true friends, they will completely empathise with your position - chances are they feel the same way or have at some point in their lives.

Finally, If FOMO is less of an issue for you than simply paying your bills is, you could consider programs like AMEX’s Plan It, which has been a lifeline for many people recently. In a year as unpredictable as 2020, the comfort this service provides to users as a way of controlling payments and making ends meet has been immense. You can find out more about them here.

Of course we understand credit cards aren’t the answer for everyone, so if you have a tendency to get carried away when using them, we would advise against their use. Alternatively, seeking the advice of a financial advisor if you are having a particularly rough year is also a great option, so email us if you’re keen for a chat or a referral.

We recently released a FOMO dedicated-podcast ep, so if you need the extra education or just want to have a giggle with the girls, give it a listen here.