Money: When to Say NO to Financial Peer Pressure

When I was in middle school and in high school, I was the quiet, nice and friendly guy every body knew. My habit of avoiding conflict inadvertently led to a level of peer pressure that I succumbed to. In many ways, my personality made me a follower. I was rarely the one making the important life altering decisions on where the boys would hang out Friday night… (OK, that was supposed to be funny). Thankfully, I was wise enough to avoid the wrong crowds.

As I grew older and eventually studied personalities and their different intricacies, I realized that I must be sovereign in my own decisions despite the fact that I was, what one may call, a peaceful phlegmatic (no worries, I’m working on a different article elaborating on personalities and how to maximize your strengths for financial stability. So subscribe and stay tuned!). When it came to my personal finances, it was even more imperative to control my decisions and my budget. Unfortunately, while working in the banking industry and advising dozens, I’ve found out that many adults have not learned this lesson. As a results, they are bound in financial instability.

Most adults would not admit that they have fallen into financial peer pressure. In a previous blog post, I discussed ‘keeping up with the Joneses’ which is essentially a form of financial peer pressure. If you have ever tried to keep up with the Joneses, let’s agree that you have then succumbed to peer financial pressure. To be ‘money-smart’ and enjoy financial stability, you must observe the masses and do the opposite. Here is how.

At work

Eating out too often

Creating professional relationships with your coworkers are great moves for your career but not when they jeopardize your finances. It is tempting to step out of the office and enjoy a daunting sushi buffet, especially when you’re invited by a group (oh the pressure!). However, spending $10 to $15 a day doesn’t help you if you’re on the road to financial stability. Even when your income allows for such expenditures, imagine how much more you would save by simply reducing the number of times you lunch out. My suggestion: plan ahead and pack a lunch. This is not about what others think. Take responsibility tomorrow and respectfully decline the offer for eating out. You will feel better about yourself.

Office social events and activities

In the quest for employee engagement, many companies have gone off track. Birthday parties, group catered lunches, Christmas gift exchanges are among some practices that get out of proportion sometimes. I’m all for fun activities and socializing. However, it is necessary to limit your participation when you can’t afford it. If everyone else is pitching $50 for the boss’ gift and you can only contribute $25, not voicing it only hurts you. I am not ignoring the fact that you may be the subject of immature gossip and pressure but your willingness to say ‘no’ will reward you later.

Costly networking events and happy hours

I love living in the D.C metro area. There are always opportunities to meet professionals at various networking events. I’ve set a goal to attend one or two professional events on a monthly basis. But I realize that it comes at a cost and I budget for it. I think you should too. Sometimes, it is ok to decline the weekly Wednesday happy hours. In 2016, people who paid for 5 drinks on a weekly basis spent an average of $2000! Ok, you’re not paying for 5 drinks. However, you may be getting an appetizer or maybe even a full meal. It adds up very fast.

Outside of work

Extravagant and expensive vacation trips

Last year, Heather and I had planned a road trip to Maine. Oh man, how excited I was! I love photography and I couldn’t wait to practice my landscape photography skills. We had it all budgeted (gas, food, hotel, etc). I was very disappointed when we decided to cancel because it would’ve made it harder to reach our savings goal by the date we had set. But it was the right thing to do. A trip around the beautiful prairies of Ireland would be a trip of a lifetime for me. Nonetheless, if my friends invited me tomorrow, no matter how much paid time off I have accumulated at work, I’d have to decline. It would negatively affect my finances. Will you do the same?

Expensive dinners or outings

The same mindset related to the work environment applies here. Let’s face it, career development and increase in income does not happen at the same rate in a circle of friends. You may be the one making the big bucks or on the opposite, you could be the one making less. This shouldn’t affect friendships and it sure shouldn’t affect your financial stability. When you can’t afford it, don’t be ashamed to say no. If your friends are true friends, they’d be willing to compromise.

Pricey clubs, sports or memberships

I live 10 min away from a gym where the membership cost for individuals is $100 or more. I have a few coworkers and friends who work out there and who have invited me to join. They’ve tried to sell me on the idea that it offers great daycare. But I’m not a parent. Although I haven’t visited the facilities, I have no doubt that it is impeccable and grandiose. I’m confident that for some it is well worth the $100+ per month. Nonetheless, it would be stupid for me to join because I do not need it and second, it will not fit in my budget. Many times, I’ve seen people fall for the temptation and join activity clubs, sports team, etc. because their friends did, when truthfully it is destructive to their finances. Learn to stand your ground and say no.
We’ve looked at a few examples of times when financial peer pressure must be fought back. There are still many ways you could succumb to this type of pressure and you must examine your habits and decide for yourself. To reach your financial goals and be financially stable, it is imperative to learn how to say NO.