Is Facebook Ruining Your Finances?

Facebook has become the new place to show off. From luxury vacation photos to friends “checking in” at nice restaurants and shopping plazas, we’re constantly reminded how other people spend money. Even a simple Happy Birthday post becomes a “status symbol” when “Sent from my iPhone” is tacked to it. Have you ever noticed that nobody ever “checks in” at Walmart?

It’s only natural to want to buy what our friends buy, vacation where they vacation, and keep up with their technology purchases. The only problem is that now, instead of having to keep up with a few families in the neighborhood (the proverbial Joneses), we’re attempting to keep up with the 150 (on average) contacts in our social network.

Here are some tips to overcome the “look what I have” culture of social media.

• Develop a financial vision for yourself and your future that is bigger than “today.” Think about your values and how your purchases reflect those values. Often, there is a mismatch. If you value education and want to put money away for your children’s future but haven’t done so yet, look at other monthly expenses that could be dropped. If you want to retire on the younger side, figure out what is worth sacrificing now for the future you want.

• Resist the temptation to brag about purchases and experiences on social networks. Research has shown that one characteristic common to frugal people is that they don’t care what other people think about them. Build a social identity based on ideas, not things.

• Enjoy your friends’ posts, but know that 50% of Americans have no emergency fund and very little saved for retirement. You can “keep up” and be one of them, or you can stick to your personal vision and values and hold back.

• Remember that there is more than one social network, and you can belong to many. Your friends may not be talking about debt, but support organizations like InCharge Debt Solutions.  By ‘Liking’ our Facebook page, you will get a daily dose of tips and advice to help you achieve your financial goals.

Visit www.inCharge.org for more information.