The Rising Cost of Making New Friends
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Why are people spending up to 80% of discretionary income on socializing?
and how they may affect your finances and portfolio. Listen at schwab.com slash Washington Wise.
Here's your money briefing for Friday, May 17th. I'm J.R. Whalen for The Wall Street Journal. Traditionally, people met many of their friends at work or school. But today, people are meeting many of their new friends at events in their free time. And it's getting expensive.
Areas like eating and drinking outside of the home, going to the movies, tickets for concerts, all of those have increased in price more so than the average inflation rate. And so people are saying that they're spending up to 80 percent of their discretionary funds on socializing and getting out there and making friends.
We'll talk to Wall Street Journal reporter Katherine Hamilton after the break.
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It's getting more expensive to do a lot of things these days, even make new friends. Wall Street Journal reporter Katherine Hamilton joins me. Catherine, now inflation is coming from me finding new friends. What's making it so expensive?
There's a few different factors. People are increasingly making friends through paid organizations. So whether that's like a gym class, an art class, any kind of like hobby that people are doing for their own personal enrichment, but also to build a larger social group. Part of it also is that inflation has increased the price of socializing more so than it has goods overall. Areas like eating and drinking outside of the home, going to the movies, tickets for concerts, all of those have increased in price more so than the average inflation rate. People are saying that they're spending up to 80% of their discretionary funds on socializing and getting out there and making friends.
You track down some research on American social lives. They have fewer friends than they used to. Why is that?
There are studies that show that the number of people who have 10 or more close friends has fallen from about 30 percent in 1990 to just 13 percent in 2021. So there's been a big decline in the number of friends that Americans have. And it's hard to pinpoint exactly why that's happening. But one major reason is changing institutions like college and work where Americans have traditionally made a lot of their friends in the past.
And how has that changed?
The pandemic had a big impact on both of those institutions. So work from home has increased a lot for folks who used to go in the office. They may not be going in as much or at all. And college similarly has changed a lot during the pandemic. I spoke to a few college students who talked about how isolating it is now to be on campus and how they felt like Growing up, they thought college would be a great opportunity to meet all these people. But in reality, they felt like in dining halls, they had to sit by themselves and everybody is really closed off post-pandemic.
So past generations who may have found friends at school and work, it sounds like there's been quite a sea change there.
You definitely hear people sort of changing their attitudes about friends and folks that they're meeting in colleges and at work. Also neighbors, too. I spoke to an older gentleman who lives in Kansas City, and he said that he's lived in apartments for most of his life, and he used to be really close with his neighbors. He would go ballroom dancing with them, and now he's very cordial with them. He feels like especially friendly.
What factors are driving the rising cost of dining, entertainment and events?
And since folks are looking at their phone more and since the pandemic, he just isn't as close with his neighbors.
Full disclosure, when I was in my 20s, I took a ballroom dancing class and I made some good friends.
Yeah, that's what he said, too. You know, you step on their feet and then it breaks the barrier.
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