Related Posts with Thumbnails

Friends, spending and status

...How to Keep Your Social Circle from Ruining Your Finance - a guest post from blog junkie Lauren Bailey. Welcome, Lauren!

Friends, as they say, are priceless. But sometimes their social activities come with a heavy price. Just as we cannot pick our family members, it can be just as difficult to pick our friends. Of course, there is much more choice in the matter, but generally speaking, we make friends in certain social settings like high school, college, through work, etc. and of the better of them we are pretty much stuck with for life. So what happens when one or more of our friends have spending habits similar to yours? Here are a few tips for keeping money from ruining your friendship and vice versa.

1. Understand that when the hierarchies and popularity contests of school are over, spending becomes a new way to establish status. For those of you who are just entering the working world, be prepared for the spending fireworks. I've noticed that during the period of time after college and before marriage and having a family, the young with disposable income are the worst offenders. Understand that some of your friends, especially those who pursue high-paying careers, will be seduced into outspending to demonstrate their worth.
2. Set the agenda yourself to include less extravagant activities. If you witness this post-college transformation of extravagant spending, it's important to put checks in place before things get out of control. Before your friends make plans to go to that expensive restaurant serving lavish cuisine or that bar with the astronomic cover charge, suggest going somewhere more modest instead.
3. Don't get caught up in the spending game yourself. It's so much easier to simply "go with the flow" when it comes to spending and friends. However, in practice it becomes harder and harder to play the spending game and can wreak serious damage on your finances. If you put your foot down early, it's much easier to say no to continued requests to join in on the spending sprees.
4. Demonstrate and emphasize that the value you reap from your friends is based on their company and not their material lifestyle. If you happen to have a cadre of friends who are particularly materialistic, and you find yourself distanced from that consumer-centric line of thinking, it is possible to win them over to your side. For example, whenever I'm with my particularly materialistic friends, I always emphasize and make "remember when" pronouncements, highlighting the good times we've had that did not involve spending a lot of money (ie. college parties, cheap road trips, etc.) By continuously emphasizing these moments, your friends will begin to see that the value of friendship is company and the sharing and creating of memories.
5. If the problem becomes really bad, be frank with your closer friends about not being able to/not wanting to keep up with their spending. While it may be embarrassing to admit to acquaintances that you cannot afford to go out with them, being frank with close friends is much easier. Instead of constantly making excuses about not being able to go out shopping, eating, or drinking, just tell your close friends that you cannot or do not want to spend your money the way they do. Tell them that if you still want to spend time together, they will have to tweak their plans to accommodate your budget.
Of course, there's always the other extreme being such a tightwad with your money that your social life is confined to watching TV at home. The most important thing to remember is to draw up a reasonable monthly budget for socializing and to stick within this range, no matter what your friends and acquaintances are up to.
Lauren Bailey is a freelance writer and blog junkie. She especially loves hearing back from her readers. Questions or comments can be sent to:


Post a Comment