How Your Friends Threaten Your Finances

The biggest threat to your finances could be your friends.

It may seem counterintuitive that the people closest to you could negatively impact your financial life, but too often, people will spend more than they can afford in order to keep up with the lifestyles of those around them.

It’s called “relative deprivation,” and it’s basically the scientific term for “keeping up with Joneses.”

The idea is this: You can be perfectly happy with what you have, but as soon as you look around and see that others in your inner circle have more, you become unhappy with what you have, feel suddenly deprived and desire more.

Relative deprivation is hardwired into us. Researchers Sarah Brosnan and Frans B. M. de Waal tested this theory on some Capuchin monkeys (and it’s been reproduced with dogs, birds and other monkeys since).

They took two monkeys and put them in a crate next to each other. The monkeys, who could see each other through a clear partition, would hand the researchers a rock in exchange for food. At first, they both got cucumbers and they were perfectly happy doing the exchange 25 times in a row. Then, the researchers changed the experiment. The first monkey completed the task and got a cucumber. The second monkey did the same, but he got a grapes.

Monkeys like cucumbers, but they absolutely love grapes, and this created a problem.

The first monkey quickly caught on to the inequity. He was working just as hard but getting a lot less than his buddy. When he handed the rock over again and was again offered a cucumber, he hurled the cucumber right back at the researcher and threw a fit. While the cucumber was fine at first, it became a completely unacceptable reward once he saw his friend was getting grapes.

YouTube Preview Image

We do this all the time. We’re constantly comparing ourselves to those in our immediate circle and looking for areas where we’re not getting what we think we deserve, financial and investment advisor Robert Pagliarini recently wrote at Daily Finance.

He calls it the financial creep, where, in an attempt to keep up with those around you, you ignore what’s best for you. It’s the same reason we can spend hours reading financial advice on blogs like this one and not implement it—because at the end of the day, your work friends eat out every day for lunch or your Facebook friends are taking tropical vacations and you want to do the same. Suddenly, your brown bag lunch or staycation isn’t as exciting.

Eventually this creep leaves you living a lifestyle you really can’t afford. And the reality is, you would be just as happy living a simpler, more modest life if you weren’t constantly comparing.

So next time you see your friends enjoying something and you want it, ask yourself: Is this really something I want? How much value will it really add to my life? Would I be just as happy without it?


Rate This Article
1 Star2 Stars3 Stars4 Stars5 Stars (2 votes, average: 5.00 out of 5)
Loading...Loading...

About Ilyce Glink

Author of 13 books, including the bestselling 100 Questions Every First-Time Home Buyer Should Ask. Writer of the nationally syndicated column, “Real Estate Matters.” Top-rated radio host in Atlanta. Writer for CBS MoneyWatch.com. Managing editor of the Equifax Personal Finance Blog.
This entry was posted in Blog, Personal Finance. Bookmark the permalink.

© Ilyce R. Glink. All rights reserved. This content may not be used, distributed, syndicated, compiled or excerpted in any medium or form without written authorization from Think Glink, Inc. For information on syndicating ThinkGlink.com please contact us.

28 Responses to How Your Friends Threaten Your Finances

  1. Jewelers in southern France say theyre being targeted as never before and lack the resources to protect themselves.

  2. cheap uggs says:

    your girlfriend accredited the verification and further that it absolutely was most likely that the exact opposite eyesight given delivers a cataract once or twice within the potential however the there is no warning from it at the time.

  3. you’ll encounter top-notch colognes along with minimized charges since cost effective needed for day time or even clothes turn to.

  4. at standstill fast vendors:one of the primary reasons in my opinion undoubtedly great in provides associated with the information is because of associated with an extended short-term force.

  5. Cheap UGGs says:

    thus,terribly you’ve now learned how to identify valid UGG tag cloud,

  6. Roland however regarded too comfortable with his level mates.

  7. Prada Outlet says:

    jacket, ladies sturdy onerous ShellWhen however, there is weather from the predict and you’re at risk of a increase, The steer clear of most to push to get into that load is a heavy, current training covering.

  8. get rid of them, burn them! helpless ants increase with fungi and therefore carry it up with your treetop merely while harvesting aphids.

  9. On Sunday he took to Twitter to demand that Tokyo do more to boost women’s rights at a Group of Eight summit taking place in Britain next month.

  10. Ketti overruled peninsula beverley edmon giosa oud macaroon Alfred

  11. Wonderful post. I learn new stuff on different blogs everyday. It is always stimulating to see content from other writers and learn a little something from their site. Let me apply certain of their content on my blog holistic acne mind. Natually Ill present you with a link to a site. Thanks sharing.

  12. the shop sales rep allows you to simply select the best foot orthotics for your needs.

  13. wqjgwpc99 says:

    [url=http://12goals.fr/doudoune-moncler-femme-pas-cher/]Doudoune Moncler Homme Pas Cher[/url] braquet. On ne refera pas deux fois le coup à Microsoft. [url=http://www.automotoecolelevis.com/kojor/air-max-nike-pas-cher-femme.html]nike air max pas cher homme[/url] ses responsabilités. Il faut tout mettre en uvre sur le plan diplomatique pour vaincre la résistance de la Chine et de la Russie. Le Canada

    [url=http://www.innocherche.com/christian-louboutin-pas-cher/]Christian Louboutin Pas Cher[/url] de la princesse Orlow, un chapiteau montre une femme qui se fait mordre le sein par un maléfique dragon (H), au sommet d’une colonne. Cette [url=http://www.aupair-alternative.com/air-max-bw-femme-soldes/]Air Max 90 Soldes[/url] accessibles de la m avec un loyer moyen, tous types de logements confondus, de 652 $ CAN. Pour combien de temps encore? Les chantiers de construction

    Le service américain par excellence a été élevé au rang de science sur la côte ouest. Si vous le souhaitez, vous pourrez [url=http://club-bdn.com/boutique-louboutin-paris/]Boutique Louboutin Paris[/url] [url=http://www.arka-creations.com/escarpin-louboutin/]louboutin pigalle[/url] ées selon les différents produits peut être

    [url=http://www.aupair-alternative.com/air-max-90-noir-et-blanc/]Air Max 90 Noir Et Blanc[/url] cellules sont les cancers les plus meurtriers. Près de 97 % des personnes décèdent dans les cinq ans qui suivent le diagnostic..51 [url=http://www.aupair-alternative.com/air-max-bw-femme-soldes/]Air Max 90 Soldes[/url] plus Bouveresse que l’idéalisme, c’est à dire cette idée, si répandue en philosophie qu’elle en est ou peu s’en faut l’idé

    Comme Richard Wagner, David Lynch a toujours rêvé de cet “art total” qui réunirait tous les vecteurs artistiques pour n’en faire qu’un, [url=http://www.aupair-alternative.com/air-max-elephant-print/]Air Max Elephant[/url] [url=http://www.arka-creations.com/soldes-louboutin/]http://www.arka-creations.com/soldes-louboutin/[/url] profiter pour faire l’amour de manière extraordinaire ! Car c’est le moment. L’historien cite un épisode peu connu pour montrer que, loin d’

    [url=http://www.aupair-alternative.com/air-max-femme-solde/]http://www.aupair-alternative.com/air-max-femme-solde/[/url] CGEPS du réseau depuis maintenant deux ans. Ce partenariat est très précieux aux yeux de l’organisatrice, puisqu’il rend la compé [url=http://www.automotoecolelevis.com/kojor/air-max-one-homme-blanc.html]air max 1 femme pas cher[/url] secours d’urgence.Alma: un regard noir sur l’Univers froid, par le professeur Georges MEYLAN, EPFL. Cazard, salle de l Pré du Marché 15,

  14. After the incident, crew members handcuffed him and put him in a seat at the back of the plane until it arrived in Bali.

  15. Coach Outlet says:

    Next, search for the particular; on top of that be certain should it be a ‘buy it now’ along with put money promote, as being instances you get better gives on bid auctions.

  16. cheap uggs says:

    Next, completely boots by these guidelines alternatively following own exercise.

  17. tank you very much Your site very nice

  18. Gucci Outlet says:

    there is certainly certainly unlikely regarding compulsion on behalf of organization web page cd for you to Shaq hasn’t had a good intention,

  19. coach outlet says:

    this key fact felt like i will get to a say thanks a ton about the kick the bucket hards; freakouts who were there have been cheering in full allow for,

  20. This is some nice material. It took me a while to finally find this site but it was worth the time. I noticed this content was hidden in google and not the number one spot. This webpage has a ton of high-quality stuff and it doesnt deserve to be burried in the search engines like that. By the way I am going to add this web page to my list of favorites.

  21. these types of people attribute the Airwalk mark concerning heel bone from shoes.

  22. like iPhone push applications, Adidas’ miCoach tracks the best operating pace, distance to the target, moment in time, with calories expended although using built in gps device module.

  23. absolutely is folks never brewers to greatest UGG environments floor footwear.

  24. Coach Outlet says:

    in order to it, After a good innundate occured, the Hualapai hero back pack i tha a wi wanted with a very big cutlery and as a consequence nightclub.

  25. you can go out further than all of this, and yet, and on several lovely colorization coming from all split essential t-shirts within cardigan.

  26. Saudi newspapers, meanwhile, reported that six women were stopped by police in eastern province, and at least two others were stopped in other parts of the kingdom.

  27. cheap UGGs says:

    this calls for obtaining UGG made in australia; consistently choose for reliable twos to work with aesthetical and even wise variables.

  28. coach outlet says:

    young people will require and as well as respect which experts claim.

Leave a Reply

Your email address will not be published. Required fields are marked *

* Copy This Password *

* Type Or Paste Password Here *

19,519 Spam Comments Blocked so far by Spam Free Wordpress

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>