With hundreds of millions of monthly active users on Facebook, Twitter, Instagram and more, there’s no doubt that social media has become the most popular way to share information with friends and family. Most often, we share the positive aspects of life, while keeping anything negative strictly offline. In the Christmas season, we see this more than ever. By posting our extravagant gifts, trips to exotic locations, and holiday activities, we’re putting forth our best and sharing the most exciting side of ourselves.
It’s no surprise that this can have adverse affects on our self-esteem, but it may be affecting our wallets as well. The proliferation of sharing on social media has brought a whole new meaning to “keeping up with the Joneses”, and the pressure to keep up with our peers can be overwhelming, leading to impulse purchases and a blurring between our needs and wants. In fact, a recent study suggests that one-third of Canadians under 30 say pressure from Facebook impacts their ability to meet financial goals, encouraging spending on items outside of these intended goals so as not to fall behind their friends.
This holiday season, retailers are starting to pick up on this and are using social media to target shoppers where they’re most vulnerable. Sixty-seven per cent of marketers are budgeting to spend more on social media during the holidays this year than last, with a large share of that dedicated to Facebook. To further encourage impulsive online shopping, both Facebook and Twitter have recently introduced “buy” buttons to allow in-feed sales.
Blake Elyea, Senior VP and licensed trustee in Grant Thornton’s consumer insolvency team, warns consumers that the danger comes when you’re spending outside your budget in order to keep up with your online image.
“We are constantly being flooded with content surrounding what others have, or what they are doing on social media and it’s getting harder to ignore and to avoid comparing ourselves to others. During the holidays especially, it can create this incredible pressure to have the latest or newest gadgets, and lead us to buy items impulsively and put us in over our heads, financially,” says Blake. “It’s worth noting that over-spending or overextension of credit remains one of the top reasons we see people coming through our doors for help, especially following the holidays. Social media is adding a whole new layer to the daily pressures we receive to spend and consume beyond our means.”
Elyea encourages individuals to take measures to prevent feeling pressured into buying unnecessary items. “The best thing you can do is to limit your time on social media and stop comparing your life to someone else’s online image and take time to embrace the spirit of the holidays. Something as simple as removing the app from your smart phone can make a huge difference. I’ve even seen Telus, one of the largest local Internet service providers, asking people to unplug this holiday season – we need to remember what’s important.” Elyea adds that sticking to a plan or budget during this time is one of the most important tools to prevent racking up credit or debt.
If the urge to spend spirals out of control, Elyea encourages people to act as soon as they realize their finances are becoming a problem. “Ignoring financial troubles for too long can lead to much bigger, longer-term problems, leading to poor credit, insolvency or even bankruptcy. The hardest part is recognizing the signs and making that first call to seek help. Call someone like a licensed trustee, who can give you a free consultation on the best steps to take to press re-start on your finances.”
Feature Image: Shopping via Shutterstock