Is FOMO Sabotaging Your Financial Well-Being?
It’s Thursday night. A friend from college sends you an invitation to a group dinner at your favorite Mexican restaurant. In an effort to save a little money, you decline. But later that evening, as your leftovers revolve in the microwave, you start to wonder if you’ve made a mistake. Are they having an incredible time without you? What memories are you missing out on? What if they remember that you stayed home and don’t invite you next time?
Enter FOMO, the fear of missing out. FOMO is that nagging anxious feeling you get when you worry that you won’t be present for an exciting moment or event. While this sensation is hardly new, social media has heightened its power. In the past, material possessions like expensive cars and flashy jewelry were the clearest indicators of a person’s wealth and social status. Today, it’s all about experiences. Consumers use social media to showcase not only who they are, but what they do. From lavish vacations to big-ticket music festivals, these days people care less about what you have and more about what you’ve done.
The role of social media
Last year researchers at the University of Glasgow set out to better understand just how serious FOMO is and how social media affects young consumers. The study involved 467 students between 11 and 17 years old. They were each asked to assess their psychological and emotional well-being, including depression, anxiety, sleep quality, and self-esteem. Generally, the teens who were most active on social media reported higher feelings of anxiety, lower self-esteem, and worsened sleep quality. The study hypothesized that social media has subjected users to a new form of societal pressure to always be available, regardless of the repercussions.
But FOMO isn’t just bad for our mental health. It’s bad for our wallets, too.
Another study found that many consumers between the ages of 18 and 34 are combating FOMO with their credit cards. The data shows that almost 40% of millennials have gone into debt to try to keep up with their peers’ social lives. When a friend suggests doing something they can’t actually afford, 27% of millennials report feeling uncomfortable saying “no.” And of the 40% of millennials who have gone into debt to keep up with their friends, 73% have kept their financial struggles a secret.
“Almost 40% of millennials have gone into debt to try to keep up with their peers’ social lives. When a friend suggests doing something they can’t actually afford, 27% of millennials report feeling uncomfortable saying “no.”
Tips to avoid FOMO spending
Is FOMO wreaking havoc on your financial situation? The good news is you’re not alone. Here are a few things you can do today to combat the fear of missing out:
Include the fun stuff in your budget: While you probably won’t do much long-term financial damage with the occasional boozy brunch or taxi ride home, you’re better off calculating these expenses into your monthly budget rather than trying to avoid occasional luxuries all together. The more realistic your budget is, the more likely you are to stick to it.
Be an event planner. By far one of the simplest ways to avoid the fear of missing out (while steering clear of credit card debt) is taking control of your social life. When you are involved in organizing social events and activities for friends, family, colleagues, and other members of your social circle, you can encourage everyone to do things that fall in line with your financial priorities.
Have a social media detox: Our dependence on mobile devices is well-documented. In fact, from dog videos on Instagram to family vacation photo albums on Facebook, American adults spend over 11 hours per day listening to, watching, reading or generally interacting with content. Try fighting FOMO by cutting back on screen time and concentrating more of your attention on personal goals and achievements.
