Geesh, It's only $5.00 – A story of financial peer pressure
By glblguy
Photo by: infomatique
“Geesh, It’s only $5.00!“. These were the words I heard uttered by one friend to another in a store we were shopping in a few weeks back. While I didn’t over hear the entire conversation, the two ladies were discussing some type of clothing accessory they were both looking at. Based on what I could tell, the one lady was trying to convince the other lady to purchase one as well. The one expressing the concern with the $5.00 cost was resistant and received the “It’s only $5.00” response in return.
This is a text book example of the financial peer pressure we are exposed to as results and also serves a to back up my opinion that “Geesh, It’s the little things that get’cha“.
The rest of the story
Let’s just play along with this example for a bit and add some, of course fictional, but highly probably additions to the story. We’ll even give fictional names to the ladies: Donna the spender (Lady #1 above) and Judy, the frugal one (Lady #2). After Donna’s comment of “Geesh, It’s only $5.00!” comment, Judy thinks to herself “You know, she’s right, it is only $5.00. I could absorb $5.00 in my budget. After all, I haven’t bought anything for myself in a while.” Then making those famous last words she says to herself “After all, I deserve it.”
Donna and Judy head to the cashier’s line to purchase their $5.00 clothing accessories. Donna decides to head to the local coffee shop to grab a Latte. When Donna politely declines, Donna rolls her eyes and says, “Come on Judy, you know you want one, they are only $4.00“. Then she completely makes the sale by saying “Well if you don’t want one, I don’t want to get one.” She lines up, shoots, and scores! Judy replies, “Well, I don’t want you to not get one….ok I’ll get one too.”
Donna and Judy spent the remainder of the day together, shopping, grabbing lunch, doing even more shopping and then finally grabbing dinner at a restaurant outside the local mall. Donna had a wonderful time, and Judy, while enjoying spending the day with her friend Donna, continued to feel worse and worse as the day progressed. She felt guilty as she knew she was spending money her and her husband hadn’t budgeted. But she just didn’t want to ruin Donna’s day.
After getting home, Judy pulled up her copy of her YouNeedABudget and grudgingly entered the transactions from the day. When she finished she was shocked at how much she had spent, over a $100.00! She double checked the transactions to make sure she hadn’t incorrectly entered anything. Nope, everything was right. She then verified the receipts to make sure nothing had been incorrectly rang up. Everything was correct. She was shocked!
The front door opened, and her husband walked in. “Hey Honey! Geesh , what a day at the office. How was your day off with Donna? Did you guys have a great day together.” How was she going to tell him she broke the budget commitment and how would he react? She felt so ashamed she had let this happen. They were working so hard on getting control of their finances, and now only a few months later she already blew the budget!
Judy looked up at her husband and said “I have something I need to tell you.”
Tips to avoid financial peer pressure
Here are a few tips you can use to avoid getting into a similar situation as Judy:
- Set yourself a daily limit – If you are heading out to go shopping with a friend, set yourself a limit. If you didn’t budget for it, either don’t go or don’t bring any money. This includes leaving cash and/or your debit/credit cards at home. You can’t spend the money if you don’t go and if you do go you can’t spend what you don’t have.
- Talk to your friend – Be honest with your friend about your situation, your budget, and how you know they like to spend money, but it’s just not something you can do right now. Explain to them how important this is and how you need their support. In the story above I would have stopped Donna in her tracks right after she said “It’s only $5.00”.
- Surround yourself with like friends – While I certainly don’t advocate abandoning your friends, I would suggest you begin hanging out more with people that share your financial views and perspectives. These people will encourage and support you, and you in turn can encourage and support them. My M-Network friends and other personal friends I have do this for me. In fact, you my readers actually serve as a constant reminder to stay on track.
- Budget some fun money – I am not an advocate of giving up on quality of life just to save a few bucks. My wife and I both have “fun money” line items in our budget. This is money that is allocated to us to do whatever we wish. I buy a few coffees, lunch, and stuff for my saltwater aquariums with it. She has other things she uses the money on.
- Avoid places where you will spend money – Instead of going shopping, go to the park, have coffee on your back deck, or visit one of the many free activities in your city. There are many other activities outside of shopping and they’ll cost you far less.
The rest of the story
Fortunately, Judy’s husband was very understanding. He knew this was a journey for them and that they would both fall back into old habits every once in a while. In fact, he went out to eat for lunch with his friends instead of eating the lunch he had packed and felt bad about it. They both went online, and transferred over the money from their emergency fund. That in and of itself was enough punishment for both of them, as they had worked for a few months to establish that $1000.00 emergency fund.
The following month, Donna and Judy decided to meet again. Donna arrived at Judy’s house where they drank coffee together and discussed what to do for the day. Donna wanted to go shopping. Judy spent a good hour explained to Donna about her financial situation, and that they were trying to get out of debt and live on a budget. Judy explained how they her and her husband did their budget together and made a commitment to each other about it. She also told her about how she had felt the last time they went out and how they had to pull from their emergency fund to cover it.
Surprisingly, Donna said that her and her husband where significantly in debt, living paycheck to paycheck, and fighting over their money constantly. She didn’t know what to do about it, and she asked Judy to help her.
Instead of shopping, Donna and Judy talked about Donna’s finances. Judy helped Donna work up a simple budget and a debt snowball. They packed a lunch and headed to the local park where they spent the day talking, walking and playing a game of tennis. Donna left, excited to head home and share their new budget and plan for financial success with her husband.
Ever been in a situation like this? What did you do? What tips do you have to share? Every have anyone Geesh you? Add a comment!
April 16th, 2008 at 8:56 am
It’s unfortunate… we’ll cut, and cut, and cut back our budgets… cutting back on cable packages and lowering thermostats, but then we go out and do something stupid like this.
It takes some time to set up the mental habit that it’s “okay” to be frugal, to stick to a budget. One step at a time…
April 16th, 2008 at 9:35 am
I have been there, done that, especially in my younger days when I was trying to keep up with friends who had better paying jobs and more disposable income. I was embarassed when I couldn’t afford things. Peer pressure doesn’t go away when you’re an adult.
It’s interesting that when I started to just fess up to friends that I couldn’t afford to go out sometimes or buy something, they were pretty understanding. And now that I work for a non-profit credit counseling agency, several of my friends have confided in me about their own struggles with debt and asked for help and advice. There’s no shame in being honest about your situation and doing something to fix it. It’s easier if you have a support group to help you out. And friends who will continue pressure you aren’t really friends. Words from childhood still ring true …
April 16th, 2008 at 10:18 am
It’s quite amazing how quickly $100 can be blown, with little or nothing to show for it. That’s why you must always convince friends and family that you’re absolutely broke. If they think you’re truly broke and struggling, then “only $5” takes on a whole new meaning.
April 16th, 2008 at 10:28 am
Great post! I like the #1 tip. Take only the cash you want to spend and leave the plastic home. That cannot fail. This is also a good example of “keeping up with the Joneses”, then finding out they are worse off than you are.
April 16th, 2008 at 12:37 pm
Somehow I feel like that’s easier for me to do with cash. If I know that the money is still snug in my account, I’m more likely not to do it. But if something is only $5 and I have $10 in cash, it feels more reasonable to spend it.
April 16th, 2008 at 1:27 pm
I like what my grandpa used to say: Look after the pennies, and the dollars will look after themselves.
My grandpa was a pretty wise man. He keeps getting wiser the older I get, even though he’s been gone for a while now.
April 16th, 2008 at 2:01 pm
Don’t carry your credit card. That was always my problem – I’d go along and just charge it. When I stopped carrying my card, it made it much easier to just say no.
April 16th, 2008 at 2:41 pm
Hmm… I’ve been here! But then my best friend went to college, and money was tighter for her then for me :)
But I still struggle… when the cash is in my wallet, it’s easy to spend!
April 16th, 2008 at 3:22 pm
Good post. I’m always in this situation with my spendy friend, and as of the past week we’re living together.
My friends are pretty carefree about spending. My friend will do the “It’s just $5” …and I often then cave and talk myself into it.
She went shopping Monday and I tagged along, with no intention to buy anything. I walked away with over $100 in clothes. I wouldn’t have even been tempted if I didn’t go with her. But in that case she didn’t push me to buy something, I just was in a mall when I normally wouldn’t be.
We’re blogging about the financial issues of living together, so check it out: http://miamiherald.typepad.com/no_spend_zone/
But yeah, I’m going to have to follow some of your suggestions of having a budget or hanging out at places where you don’t have to spend a lot of money.
April 16th, 2008 at 3:37 pm
Good story. I use to be the bad friend who spends $$$ but now I am the good friend and when I see my friends by something, in my mind I am thinking “Oh don’t buy that” : )
April 16th, 2008 at 6:43 pm
I know the feeling of being out with friends who are big spenders. I’ve found that not making a big deal about not buying stuff works for me. Several years ago, I truly didn’t have the money to spend. These days, I have the money, I just choose not to spend it at malls. On the rare occasions when I do end up spending a day shopping with friends, I buy almost nothing, but don’t talk about it. We talk about other stuff, and they don’t seem to notice that I’m not buying stuff. I order water with my lunch and nobody notices. I think that when people make it obvious that they want to buy stuff but can’t afford it, it becomes an issue.
April 17th, 2008 at 4:41 pm
Excellent Post!
I have certainly been there. It’s hard to tell someone that you are saving or don’t have the money. My biggest weakness is eating out. I love a good meal out.
Keep up the good work!
April 17th, 2008 at 4:58 pm
Great post!
I have the same problem with our friends. We get together each Friday for supper and to spend time together. Each week they want to eat out at a different restaurant.
I forked over the money each week for six months, until I finally suggested that we try cooking together. I explained that the $15-20 takeout bills were really hurting our budget. To my suprise, they had the same budget problems! Now we’re both a few dollars richer each week, and we have a blast cooking together.
April 18th, 2008 at 6:35 pm
Very good tips. This post makes me think of Matt 25:21:
“You have been faithful with a few things; I will put you in charge of many things.”
Peer pressure is a rough thing at times. I struggle in some areas, but I’ve finally realized that I don’t care what others think of me when it comes to how I make decisions regarding my health and finances. I’m sure I’m “odd” to some, but I’m o.k. with that. :-) I do what is best for my family and for me, and I don’t have much issue going against the crowd if the “normal” thing to do won’t bring me pleasure or a benefit. And setting limits always works well too, especially because you have a rule on the top of your mind if someone tries to be persuasive.
April 20th, 2008 at 5:33 pm
I used to go shopping with a friend who was — often — buying things she’d end up not using/wearing/wanting. She often encouraged me to do the same. I’d just say…hmmm, I will think about it. and put whatever it was back, knowing that if I wanted or needed it enough, I would come back and buy it another day (which drove her crazy, as part of her pleasure was seeing someone else buy something…not in a malicious or bad way, but from the feeling that it would be a pleasure for me/her other friends). Or…much more likely…I never even thought of it again…or didn’t want to take the trouble (a sign!). Saved me a lot of money.