As a twenty-something it’s really easy to give in to the financial peer pressure that surrounds us in many different ways on a daily basis.
Your family members all buy new cars. Why would you want to purchase a used vehicle?
Your friends go clubbing every weekend. Why would you want to stay in?
Your co-workers go out for lunch every day at work. Why would you want to brown bag your lunch?
If you’re old school you call it, “keeping up with the Joneses.” Regardless of what you want to call this phenomenon, it’s detrimental to your financial health.
How can you deal with financial peer pressure?
Set financial goals.
Do you want to make out your 401K contributions? Do you want to build a $2,000 emergency fund? Perhaps you would like to do something a little on the enjoyable side, such as, travel the world or move somewhere different? Whatever you want out of life it’s important that you set financial goals to help you get there. We all know that a goal is like a dream with a deadline. Finance goals are no different.
Keep your goals visible.
Anyone can write down a bunch of goals on a piece of paper. The challenging part is keeping these goals in your face on a daily basis. Nobody likes to do this simply because it’s much easier to set goals than to actually struggle attain them. It’s also very demoralizing when a few months go by and you realize you’re no closer to your financial goals.
A little mental hack that works for me is to place my goals at eye level on the wall where I usually use my laptop. As I’m typing away I will look over to see my goals starring right at me. Sometimes this reminds me why I’m still up at 3 in the morning writing a blog post. Other times it’ll annoy me to the point that I want to rip the paper off the wall.
If you’re into The Secret or other positive-energy-you-can-do-it-type thinking then you can take this one step further. Find an image or two that best describes your financial goals and keep it visible. This can be a picture of your dream home, destination you would love to travel to, or a car you want to buy in the near future.
If positive thinking just isn’t your thing (which is cool) then there are more tips below for you to avoid financial peer pressure.
Change social circles.
Rid yourself of the lavish lifestyle.
I have friends from college that are completely immersed in the whole socialite atmosphere. They associate with people who they clearly don’t consider to be true friends, they spend money they don’t have on going out, and instead of doing something productive they focus their energy on living an unrealistic lifestyle.
I don’t know how to put this nicely so I will just say this- get your ass out of this fake world. Find friends from school with similar career ambitions. Hang out with people from the gym or a sporting team that share similar goals. Get away from socialite crowd and associate yourself with ambitious individuals.
I really enjoyed this post, especially “get your ass out of this fake world” lol. Going through college my self right now, I’ve had to make some tough decisions as far as friends and career path. None of which were easy, none of which I have completely fulfilled yet. It is hard to do what you love when everyone around you idolizes something else or expects something of you. And its even tougher when your unsure of paths your decisions will take you.
Good insight man.
Slightly late to comment – but I really loved this post. I had a very similar experience in college. I went to NYU where all the people were insanely wealthy. Crazy wealthy. Upper East Side crazy wealthy. I think that for a long time I tried to pretend I had no boundaries, but really the boundaries (financially) were everywhere. I couldn’t keep up.
I think living in reality isn’t always glamorous, but it’s trying to be responsible. And proud of myself and my accomplishments. Great post!
amazing points!?! i am really trying to get this threw my brothers’ heads…emailing them this NOW! 😉 thanks.
Edward, maybe it’s just about people deciding on what are the most important ways to use their money. Many times people are wasting away their money without realizing it. They don’t create their goals, so they end up just going out on weekends, for example, trying to fit in socially. If they consciously think about their money and goals, they may spend very differently.
One thing that keeps me motivated is Dave Ramsey’s theory that normal is bad. When people comment on my money habits, I take that as a compliment. When normal is huge car payments, credit card debt, and paying off student loans in 30 years, I want to be weird.
I agree with you there. I was trying to make a point about letting money control you, which is just as easy if you don’t keep track of it as it is if you do.
The more I read about what is typical for my age group, the more I realize that I’m pretty darn weird myself.
Wait, when I worked in an office, I was never invited to go out for lunch. *sniff*
I think people make way too much about money. It’s there to be spent. They key is to determine what level of lifestyle works for you and what is just extravagant. I don’t need new cars and new computers, organic food, or to go out drinking on the weekends. For the lifestyle we want, my wife’s $27,000/year salary is sufficient.
Great advice and if anyone is looking for a structure in order to reach their goals then may I reccommend the “7Life System” which has so far help an incredible amount of people.
http://thelifething.com/productivity/a-simple-structure-that-will-change-your-life/
Great work untemplater guys.
I just pick and choose wisely what I decide to do. All my friends know me. They know my goals. If I decide not to go out to dinner because I’m saving for something else, they understand and respect that.
The important part is honest. If you just say no and give no explanation, they will stop calling you all together and you will loose them as a friend.
Sounds like you have a respectable group of friends RJ. I’m impressed by how open you guys are with each other. I also agree that communication is definitely needed because you don’t want to be known as the guy who always says no.
The changing of the social circle idea is the greatest part about this post.
Constantly trying to fit in with a social circle and ending up in financial hell is not fun, believe me.
I changed social circles unconsciously (the new one is so much more fun) to one that doesn’t really care about material possessions… and it’s been one of the best choices of my life! I no longer need to “try to keep up”.
Great post.
Switching social circles can be a completely conscious effort or something that happens without you even realizing. It can become very depressing to always try to keep up with a group of friends that have different goals and a completely different life from your own.
Very true. I think every socialized person are experiencing financial peer pressure. I’ll admit that sometimes I had some things compromised because of this. Setting up goals can really help coping up with this pressure, since you are more focused financially on something.
I guess I just started hanging out with people who “have what I want” – as in financial freedom, no debt, etc. Instead of sequestering yourself from your friends, go meet some people who have good money habits. My boyfriend and I have made friends with lots of other Dave Ramsey fans, and it provides just the opposite of peer pressure – it’s support. And we embrace our “weirdness” with money. We know we’re not like other people our age, but we don’t care. I’ll take weirdness over your ridiculous car payment any day of the week.
I have recently started hanging out with an older friend that has is MBA already. He’s many years ahead of me in terms of finances, education, family, and life. It has really helped to show me that there is a light at the end of the tunnel when it comes to working hard in your 20s.
Thanks for your sarcasm Tyler! That was just one example and there’s nothing mentioned about eating alone. There are people that don’t leave the office for food. There are different lunch breaks for different employees. You don’t have to go out everyday. You can bring your lunch with you when people go out. I could go on but this is just a minor issue apart of the bigger picture here.
that is a great, GREAT article. Many people seem to not really have friends but instead drinking buddies. When the only time you hang with these people is drinking on the weekend. I am looking forward to more articles by you and this website. Just read he manifesto as well.
Thanks David I appreciate the kind words.
I deal with financial peer pressure the same way I deal with everything else in my life: openly and honestly. I have no problem talking about how much I make or don’t make and if I can’t afford to do something for whatever reason, I’ll usually just come out and say so.
If I’m struggling to rub two pennies together come pay day and I’m being coerced into having a bit of a beer drinking session, then people damn sure know they’ll be getting the rounds in all night. I’ve had many-a free hangover courtesy of my open and honest approach to finances!
I like your strategy Ian. That makes perfect sense, “if you want see me drunk, buy the beers.” I’m going to try that one day.
My biggest problem was friends and coworkers always going out for lunch. Where I was working, it was the only way to get out of the office if you aren’t a smoker. I’d say I ended up spending more on that than anything else as far as my discretionary spending was concerned. Skipping on going to get lunch only served to separate you from the group, so it wasn’t always the best option when you’re forming relationships at a new work place. In the end I was splitting it about 50/50 during the week.
Since I quit my job and started working for myself, I’ve had no issues with this :p
Do you meet up with friends for lunch at all now that you’re self-employed? Just curious.
I totally agree with the sentiment of your post Martin. You are absolutely right, i have friends that are close friends, and then friends that i drink with. Distinguishing between the two can be a bitch at times.
As well as i am doing in my own life, i almost refuse to plan for the wedding you mentioned. I mean, if i end up with a chick that thinks spending $20,000 on a wedding is a good idea, she probably isn’t the one for me.
It’s very challenging/emotionally difficult to determine who are your real friends and who are the people that you simply only drink with. Once you do you will realize that you’re better off associating with your true friends that share similar goals.
As for the wedding part- nobody wants to think about it but there’s a good chance it’s going to happen. You don’t want to kill your finances in your twenties and then have to convince your future wife to have a “smaller” wedding.
Good article Martin. Just to add to your short bio below, “following your passion” IS a real job. Maybe you should say, …than going to look for a “template job” after college.
Good stuff!
Good point but I was referring to what our parents/professors tell us when we discuss ideas that challenge the “norm.” I’ve heard the get a “real job” line so many times in the last few months that I figured it’s time to have some fun with it.
great article, i agree 100%, there is so much more satisfaction spending time with real friends, and you dont have to spend any money to have a good times!
With your real friends you can have a blast without spending a dime, I agree.