Financial FOMO: Avoiding 'Comparison Envy'
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What is 'Financial FOMO' and why does it matter for your money?
With your Money Briefing, I'm J.R. Whelan. You've heard of FOMO, or the fear of missing out. Well, that feeling could cost you dearly when it comes to your personal finances. We'll explain in a moment. First, these money and market stories you need to know. If you shop on Walmart.com and you see a product is out of stock, it could be because the company changed its e-commerce systems to avoid orders deemed too expensive to ship. The journal Sarah Nassauer reports the change means that a bottle of detergent or a can of cat food stored too far away from a customer's shipping address will be unavailable for purchase. Previously, Walmart would ship those items regardless of distance or shipping cost. The shift is part of a test to see if Walmart can deliver more products via ground shipping, which is cheaper than air shipping, in two days or less and reduce situations where online orders arrive in multiple packages from different warehouses.
The Wall Street Journal Heard on the Street team says that investors looking for the next Gucci to put their money to work in the luxury fashion sector should not overlook, well, Gucci. Heard on the Street says that while alternatives such as Prada and Burberry might seem attractive, Gucci's sales have popped roughly 45% since 2016, and younger buyers account for half the company's numbers. And that's highly unusual in today's luxury market. In the Wall Street Journal, Real Estate Bureau reports that TV personality Dick Cavett is cutting the price of his Montauk estate by 22% to $48.5 million. That's down from the $62 million he was seeking when he first listed it last spring.
Which recent money and market headlines set the stage for this conversation?
Cavett's 7,000-square-foot estate known as Tick Hall sits on six acres and has six bedrooms, a half-acre pond, a reading perch with views of the ocean, and a bell tower above a wraparound porch.
The grass is always greener next door in the neighbor's yard. We hear that often, but developing comparison envy can not only impact one's sense of pride, it can damage one's financial health. United Capital CEO and founder Joe Duran is here to discuss. So Joe, we use measurements and benchmarks to gauge how well investments are performing, but when we compare ourselves to friends and neighbors, we often don't see what's going on below the surface.
We don't advertise when you go on social media. You don't advertise what it costs to get things. You just show how lovely and glamorous your life is. And there are really three ways in which you get impacted. Two, in really your lifestyle. The first is, of course, that you see the way that people live, but you don't see the cost of it, as you just mentioned. And so you you don't see the extra time they had to put in to take that lovely vacation or the fact that maybe they haven't been able to spend time with their family and watch their kids' sports because they needed to make more money. So the cost is seldom left out of any conversation.
Now, you mentioned social media.
How does social media create comparison envy that affects finances?
That's a big culprit here because whether it's posting photos of vacations, new cars, nights out at a fancy restaurant, it's easy to compare ourselves and feel down about things. But not everybody can afford necessarily what they spend money on.
That's true, and it's also true that often the meal is not quite as lovely as you imagine it might be. They're not showing you the argument they might be having after that second glass of wine.
So history records the nice-looking beef stew.
Right, but not what's happening around it. Now, it's possible that everything is as perfect as that picture you're looking at, but it's also equally likely— that he's annoyed at how expensive the meal was or she's annoyed at the fact that he won't stop boasting about it. So again, what we've got to remember is this is their life and it is not your life and that their being happy takes nothing away from your being happy. And that what makes one person happy is not necessarily what should make you happy. And so this comparison, it's very important to remember two things.
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Chapters
6 chapters
1
What is 'Financial FOMO' and why does it matter for your money?
0:05–1:39
2
Which recent money and market headlines set the stage for this conversation?
1:39–3:03
3
How does social media create comparison envy that affects finances?
3:03–5:32
4
What hidden costs and sacrifices are masked by curated lifestyle posts?
5:32–7:12
5
How can FOMO distort your investing decisions and timing?
7:12–8:04
6
What practical rules does Joe Duran recommend to resist comparison-driven spending?
8:04–8:07
Speakers
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