If trying to live large is leaving you broke ... is it really worth it?
Striving to match your neighbors' levels of "success" is still a pressure many people face ... whether that's desiring the same "stuff" others have or the same social standing. And now, thanks to social media, each day you compare yourself with hundreds of "Joneses" you've never even met as you peek at their Facebook, Pinterest and Instagram feeds.
There's even a term for this form of spending just to flaunt your "wealth" and make others believe you have social value. It's called conspicuous consumption.
"Not me!" you say? Think you're immune to the pressure of "keeping up with the Joneses"?
Here are three ways to check and see how susceptible you are to comparing yourself to others:
1. Your wants are always "should's"
Forget practical shoulds like I should avoid alligators. When it comes to money, your shoulds are actually emotional elevations of the things you want in life, and these shoulds control your brain. You have deeply passionate beliefs about: what you should own, where you should live, what you should wear, where you should vacation, and what club you should join.
These things are not mere wants for you ... in your mind, they fall into categories of "right" and "wrong." It's "right" to have them and WRONG if you don't. There is an ideal image of who you believe you "should" be and every purchase you make must reinforce this image, or you panic. Usually this ideal version of you is a copy of someone else, someone you idolize. And to become more like that person, you try to replicate their success with your purchases (whether you can honestly afford those purchases or not).
If you find yourself "shoulding" all over yourself, you might be trying to keep up with the Joneses.
2. Living big but you're bank account is empty
The Country Financial Security Index reports that more than half of the population surveyed admitted to spending more than they earn on a monthly basis at least occasionally. And 21 percent admit their monthly spending exceeds their income at least half of the year.
If you're broke or in debt trying to buy a lifestyle you really can't afford, you're definitely trying to keep up with the Joneses.
And doesn't it make you wonder if the Joneses are doing the same thing? What if the Joneses can't afford their new car either? Maybe they're drowning in debt to own that shiny new car, and here you are trying to elevate your lifestyle to match theirs. It's possible neither of you can truly afford the lifestyle you envy each other for. Is all this madness really worth it?
Simon Cowell, the straight-shooting Brit from X Factor and American Idol fame said, "When I was 30, the company that owned Fanfare went bust, and I effectively lost everything. I had to move in with my parents. In hindsight, it was the best thing that happened in my life because I learned the value of money: not to borrow money and not to live beyond my means. And I learned that getting there is more fun than being there."
Don't let keeping up with the Joneses break your bank (especially when their bank account is likely empty, as well).
3. Appearances trump everything!
If your appearance is more important to you than the avoiding debt and interest payments—common sense is in great need here because you're caught in the Joneses comparison trap.
Are there things you purchase regardless of the price tag just because you want the neighbors to see them? Or, have you convinced yourself on some level that if you only had "X," you'd be happy?
"Jones chasers" believe that looks and how others perceive them is more important than anything, including retirement, college funds, staying out of debt or any other solid long-term financial strategy. Do you tell yourself you won't need to worry about money once you're running with the big dogs? Do you rationalize that the debt of costly appearances are just an investment in your soon-to-be wealthy next chapter?
We wish that were true. But more often than not, the debt ditch is dug so deep that climbing out is a painful process.
Keeping up with the Joneses causes all kinds of challenges—namely, bankruptcy. In the last 30 years there's been an alarming shift, with the vast majority of bankruptcies filed by consumers, not businesses.
Does it feel like we're dashing your dreams of "living large" right now? That's not what we're after.
No one is pointing any fingers or kicking you out of the neighborhood. Who hasn't felt a pang of envy when Mrs. Jones drives up in a new car and exits, wearing a great pair of shoes and stylish sunglasses?
The first step in combating this mindset and potential trap is noticing it (or the potential for it) in your life. Pay attention to who you envy and why! Then, start finding things to value in your own authentic life now (exactly as it is). That's the second step toward breaking the comparison cycle.
And lastly, maybe consider that someone is currently going broke trying to keep up with you! Your life is probably pretty good just as it is.
Scott & Bethany Palmer: The Money Couple® are the creators of the 5 Money Personalities. They also provide real-life anecdotes and powerful parenting advice in their book The 5 Money Conversations to Have with Your Kids at Every Age and Stage.