Can your budget withstand social-media pressure?Nov 27, 2015
These days, if you’re under 30 and not on social media, you’re considered an anomaly. Whether it’s Facebook, Twitter or Instagram, your friends are likely sharing all the important events in their lives—including their vacation photos, fancy dinners and that brand-new designer handbag they just bought. Does this make you feel left out?
Whatever you do, don’t let your jealousy get the best of your budget. Many millennials suffer from FOMO, aka the Fear of Missing Out—not to be confused with a certain Drake motto. By trying to keep up with your free-spending, Instagramming peers, you might be doing yourself a disservice, rather than servicing your debt.
November is Financial Literacy Month in Canada, and it isn’t too late to get on board. One of the key components of the Financial Consumer Agency of Canada (FCAC)’s national strategy for financial literacy is planning and saving for the future—right alongside managing money and debt wisely. According to the FCAC, you should create a budget if any of the following applies to you:
- • you find that money is tight
- • you don’t know where your money is going
- • you have problems paying off your debt
- • you don’t save regularly
- • you want to find ways to make your dollar stretch further
Now that you know you need to manage your spending, do you know where to start? The FCAC also offers an online budget calculator that allows you to enter all your monthly sources of income, savings and spending to determine whether you have a surplus or a deficit. By breaking down all your expenses by category, you’ll also see where you might be able to cut back—and impulsive, FOMO-related purchases would probably be a good place to start. In the end, it comes down to the concept of needs vs. wants. Ask yourself one question: “Is this something that I literally can’t live without?”
Discover the Joy of Missing Out
It turns out that your friends might not be having as much fun as they appear to be on social media. According to an online study, 58 per cent of people say that posting the perfect picture has prevented them from enjoying life experiences. And a whopping 91 per cent said they’ve seen a tourist miss out on a special moment because he or she was too busy trying to take a selfie. For folks like them, it might be time to turn their FOMO into JOMO—the Joy of Missing Out.
Those joys can certainly include keeping up with your budget and making a dent in your debt. There is a certain pride and sense of accomplishment that comes with paying off debts, whether you use the debt snowball method to pay off the smallest debts first, or the debt avalanche to attack the highest-interest-rate debt. Once you’re debt-free, you can look back at those pictures of $200 dinners and realize that the cost of keeping up with the social-media savvy would have been detrimental to your goals.
If you don’t have any goals written out, or don’t have a financial plan, November is an ideal time to revisit your finances and re-examine your debt. Not only will you get a head start on the new year, but you can also take advantage of the tools, presentations and resources around Financial Literacy Month to help you ignore the distractions on social media and make strengthening your finances a priority for 2016.
When was the last time you coveted something from a friend’s Facebook feed? Share your thoughts with BDO by joining the conversation on Twitter using #BDOdebthelp #CountMeInCA