Conquer FOMO and Stay on Track: From a Financial Advisor

Your friends just got front-row tickets to see your favorite artist live. Your cousins are planning a big trip instead of the usual family reunion. Your neighbor showed off their brand-new kitchen remodel.

Enter FOMO—the fear of missing out. It’s that annoying feeling that others are having fun or enjoying things you don’t have. This feeling can make you want to go after the same things.

However, often spending too much to keep up can hurt your finances. It can take away from what really matters, like reaching your personal goals, saving money, or investing in your future. Here’s how to recognize and manage FOMO to avoid overspending.

What is FOMO?

FOMO is the sense that something exciting is happening while you’re left out, often triggering anxiety or impulsive behavior—especially when it comes to spending. Social media makes these feelings stronger. It shows you constant views of others' perfect lives.

This can make you question your own choices. Watching others spend on adventures, gadgets, or upgrades can tempt you to follow suit, even if it’s not in your financial best interest.

What drives FOMO?

FOMO often stems from social comparison—the tendency to measure your life against others’. Unfortunately, these comparisons are rarely fair. People compare their full reality to curated highlights they see online or hear about in passing. This leads to filling in gaps with assumptions, often making others’ lives appear more enviable than they truly are.

For example, Michael, a 27-year-old software engineer in San Francisco, admits he sometimes feels compelled to buy the latest tech gadgets after seeing friends post about theirs online. Even though he already owns what he needs, the urge can feel overwhelming.

His solution? He waits. “If I still want it after some time has passed and the feeling is just as strong, then I’ll consider it,” he says.

How FOMO impacts finances

FOMO can leave you feeling inadequate or behind socially, professionally, or financially. This pressure to keep up can lead to spending too much on luxury vacations, home upgrades, or trendy items. This habit may feel good now, but it can take money away from important goals. These goals include building an emergency fund or saving for retirement.

To avoid this trap, financial professionals recommend keeping at least $1,000 in emergency savings. They also suggest saving three to six months' worth of expenses over time. Additionally, setting aside 15% of your pre-tax income (including employer match contributions) for retirement is key to preserving your lifestyle in the future.

Tips to minimize FOMO and overspending

1. Practice gratitude: Focusing on the positive aspects of your life can help counteract the urge to spend unnecessarily. “Appreciating what you already have can be incredibly grounding,” says Dr. Christine Hargrove, a financial therapist based in Georgia.

2. Set long-term goals: Clear financial priorities can make it easier to resist impulsive purchases. Fela Kuhn-Pourqué, a life coach in Florida, credits her focus on goals like traveling with her child, saving for retirement, and funding her entrepreneurial dreams with helping her curb unnecessary spending. “Having a strong vision for the future keeps me grounded,” she explains.

3. Understand your spending triggers: Impulse spending often reflects deeper emotional needs. For example, a desire for frequent vacations might stem from a need to unplug and spend quality time with loved ones. Identifying the root cause can help you find cost-effective alternatives that meet those same needs.

4. Reduce comparisons: Be mindful of how social media influences your emotions and spending. If scrolling triggers FOMO, take a step back or recognize it for what it is—a fleeting feeling, not an indicator that you’re falling behind. Sometimes, spending less time online is the best remedy.

5. Allow for small indulgences: You don’t have to cut out every splurge. Michael, for instance, lets himself buy inexpensive items, like a book, when the urge strikes. These small, thoughtful purchases allow him to satisfy FOMO without derailing his budget.

6. Recognize what you don’t know: It’s easy to assume things from someone’s online presence or brief chats. However, these glimpses often do not show the whole story. Remind yourself that the “greener grass” you see may not be as lush as it appears. Focus on your own path instead of drawing unfair comparisons.

Sources:

https://www.fidelity.com/learning-center/smart-money/fomo

Disclosures:

This information is an overview and should not be considered as specific guidance or recommendations for any individual or business.

This material is provided as a courtesy and for educational purposes only.

These are the views of the author, not the named Representative or Advisory Services Network, LLC, and should not be construed as investment advice. Neither the named Representative nor Advisory Services Network, LLC gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Advisor for further information.