Is the “fear of missing out” leaving you in debt with financial regret?
The fear of missing out, or FOMO, can lead you into debt quickly without realizing it. It is important to have your goals and finances run on parallel tracks and to revisit those goals regularly to make sure they stay on course and don’t crash.
If you are planning to splurge on something, then you might want to consider first checking your budget and making sure that your decision is a financially responsible one. If you budget regularly, then you will always know how much extra money you will have to do certain things. If you don’t take care of your budget, then you may be left with financial distress and big debt.
Use Cash Instead of Credit Cards
It can be tempting to charge an extravagant vacation to Vegas on your credit card, however it is not always the most responsible decision. You can find yourself falling into debt easily from the small things and won’t be able to afford the big things for your future, such as your house or even your wedding.
If, for example, you plan to attend a concert with friends in the next month or so, then why not pay for your ticket in cash and take a limited amount of cash with you to avoid having to deal with credit card debt later on. Save up your cash and try not to splurge.
If you do plan to use your credit card for big events because you fear you will miss out on the fun, then charge it and pay it off. It is important to pay off the full balance of your credit card each month to maintain a good credit score. (You can monitor your credit health, and track your progress against your own financial goals by getting your free credit report summary, updated every month, on Credit.com.)
Have a Debt Repayment Plan
If you are someone with large debt already, such as student loan debt, then you may have a high dose of FOMO in your system. Stop worrying. Instead of dwelling over the events you are missing out on, why not use that to fuel your motivation. You may want to consider putting more money toward your debt, so that it gets paid off quicker and easier. The quicker you pay off your debt, the sooner you will be able to indulge in the fun. (Here’s a credit card payoff calculator to help you make a plan.)
Pro tip: If you make biweekly payments on your credit card or student loans, then you will see a big decrease in your loan as time goes on. Making biweekly payments will not only meet your interest, but also the principal. You will be surprised to see how much you will pay off in a year or two, you may even cut your loans in half.
Open a Savings Account
Let’s face it. We probably all have FOMO, so if social media is leaving you wondering why you aren’t on a vacation in Cost Rica, why not make it a goal to get there? You can start by tuning out Facebook and Instagram for a while and consider opening up a savings account. You may want to consider putting 5% of your net pay into the account each month. You can even throw in a portion of your tax refund or end-of-year bonus to help you reach your goal. There is no rush to blow your paycheck. Take some time and save money. If you play it smart, then you may even find other people feeling FOMO from your life.
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Image: Bartosz Hadyniak