April 28, 2015 3:48 pm
Updated: April 29, 2015 12:45 pm

Fear of Missing Out causing financial stress: expert

Bruce Caplan, a bankruptcy trustee from BDO Canada, said the Fear of Missing Out – or #FOMO as it’s known on social media – is financially hurting certain people simply because they don’t want to miss out on what other people are doing.

AP Photo/Charlie Riedel, File
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WINNIPEG – If you’ve ever logged into your social media accounts and felt jealous of what your friends are posting and doing – you’re not the only one. In fact, there’s a name for it and it’s starting to take a financial toll on some people.

Bruce Caplan, a bankruptcy trustee from BDO Canada, said the Fear of Missing Out – or #FOMO as it’s known on social media – is financially hurting some simply because they don’t want to miss out on what other people are doing.

“The fear of missing out is people being inundated with social media, seeing what their friends are doing, seeing all the tweets, seeing on Facebook — people are going out, fancy meals, expensive trips, buying new cars, all sorts of things, and people don’t want to miss that,” said Caplan.

Facebook, Twitter and Instagram are just three social media sites that allow people to post what they’re doing. Users can constantly update their statuses, send out pictures and start discussions on what they’re up to. Though each individual has almost free rein to post whatever they’d like their followers to see, for some people, a hint of jealously and a fear of missing out on events and activities starts to set in.

READ MORE: Winnipeg’s wealthiest carry more debt, less risk of bankruptcy: report

“They’re making decisions based on what they’re seeing on social media,” said Caplan. “Almost two-thirds of Canadians are affected by social media.”

People see friends on social media attending expensive social events and festivals, buying new cars, going out to eat at expensive restaurants and simply spending money. Not everyone can afford these things, but for many, it doesn’t stop them from spending what little money they do have.

“Debt loads are at historically high levels,” said Caplan. “For every dollar that we earn, we spend $1.63.”

It may be difficult to curb your spending and make responsible financial choices — especially when you see other people frivolously spending their money — but Caplan said one of the first steps is being mindful of what you’re seeing on social media.

“People really need to filter their social media,” he said. “They shouldn’t spend excessive amounts of time on social media. They need to scroll through it. See what people are doing. It’s okay to look at that, but people need to be really conscious of how they’re spending their money.”

There’s nothing wrong with creating a ‘Wedding’ board on Pinterest for inspiration or following Instagram accounts of people with extreme cases of wanderlust, but the problem is acting on what you see and buying things when you can’t afford them.

“Putting social media aside, people need to look at how the money is being spent and whether or not they can afford to spend it,” said Caplan.

Some ways Caplan suggests to help monitor spending and debt are budgeting, looking at long-term impacts of spending decisions and using online tools like winnipegdebthelp.ca.

These tools are designed to help people see how much money they’re spending versus how much money they’re making.

READ MORE: Tax season: Tips for students, first-time tax filers

“If they’re continually spending more than they’re bringing in, at some point the house of cards is going to tumble,” said Caplan. “Really they should — if they see something they think they want — I’d suggest just putting it aside. Wait a day, wait a week and then look it at again and think, ‘Do I really need that? And can I afford it?’”

It may seem like a good idea to buy that expensive coffee every morning or plan a trip to Mexico every winter, but people need to look at the long-term effects of their spending.

“There was a study recently out about retirees,” said Caplan. “59 per cent of retirees are carrying debt into retirement. And when people are continually accumulating debt and never paying it down—that’s really dangerous.”

© 2015 Shaw Media

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