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“Keeping up with the Joneses”: How peer pressure has sent 4.3 million Australians into debt

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Millions of Australians are overspending to keep up with their friends and family, according to new research by Finder.

A nationally representative survey of 1,000 respondents found 47% of Aussies have felt pressured by their social circle to spend money.

The research found 1 in 5 (22%) have gone into debt or spent more than they can afford because of the pressure to spend – equivalent to 4.3 million people.

More than a quarter of Aussies (28%) have felt forced into splitting a restaurant bill evenly when they had ordered less food than others.

Men ($1,560) have overspent substantially more than women ($912) to keep up with friends and family.

Kate Browne, personal finance expert Finder, said money is still a taboo topic for many.

"Unfortunately, money can cause rifts between friends and families at times.

"Everyone has different incomes, money values and financial priorities, and finding the spending sweet spot with friends can be a tricky situation to navigate."

The research shows 1 in 7 (14%) people have been coerced into going on an expensive holiday with loved ones.

A further 9% have felt they had to fund a bucks or hens night, while 7% have felt pressured into paying for someone else's baby shower.

Some Australians even admit to buying expensive items like a nice car (8%), a home (8%) or designer items (8%) to keep up with their friends and family.

Browne said feeling guilted into spending more just to keep up with friends is an easy way to blow your budget.

"While no-one wants to be a party pooper, consider suggesting a more affordable alternative when you are invited to a fancy dinner or on a pricey holiday. You can always be honest with your loved ones and say while you value spending time with them, you don't want to spend too much money doing it.

"Money management apps – like the Finder app – can help you see your income and expenses all in one place and figure out how much you can afford to spend.

"At the end of the day, it's your money and you get to decide how you spend it. If your friends are good friends, they'll want to see and spend time with you – and the location really shouldn't matter."

Millennials are the most vulnerable to financial peer pressure, with 69% having spent money because of social influence, and 36% admitting they've gone beyond their financial limits to do so.

Have you ever felt pressured to do any of the following with friends/family?
Split a bill evenly at a restaurant when you ordered less28%
Go on an expensive holiday14%
Buy concert/festival/sporting event tickets10%
Pay for someone's bucks/hens night9%
Buy a house/apartment8%
Buy a nice car8%
Buy designer items8%
Pay for someone's baby shower7%
None of the above53%
Source: Finder nationally representative survey of 1,000 respondents, January 2022
Have you ever gone into debt or spent more than you can afford to keep up with friends/family?
Source: Finder nationally representative survey of 1,000 respondents, January 2022
Over the past 6 months, by how much have you gone into debt or spent more than you can afford to keep up with friends/family?
Baby boomers$340
Gen X$1,258
Gen Z$1,039
Source: Finder nationally representative survey of 209 respondents, January 2022
*Only asked to those who responded 'Yes' to the previous question

Learn how to create a budget using Finder's free budget planner calculator.

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