With the Joneses Anyway?
Here's some advice that can change your life: Let them go. Even if you manage to "keep up with the Joneses," in the end, you'll be left with the queasy feeling that you overpaid. But to understand that, we need to first look at why we feel the need to keep up with the Joneses and what exactly that means anyway.
The phrase of course refers to the desire to have as much as our neighbors have. A simple example: After seeing a neighbor's new car you suddenly want a new car. Why? There are a few reasons. Some of us just like new cars and the neighbor's reminds us that our car is a few years old and can be replaced. Or, we crave the status symbol. We don't want our neighbors to see us driving a less expensive car, which would suggest we earn less money and thus are less successful. And lastly, when your neighbor buys a car, consciously or not, we surmise that we must be able to afford a new car as well. In fact, it can even create an expectation that you upgrade your car. Spending becomes justified by the idea that "This is how it's done in this neighborhood." A good example of this is lawyers who tend to spend a lot of money dressing the part of being a lawyer because "This is what lawyers do."
Keeping up with someone else's spending problem?So what's wrong with being like our neighbors? Well, to paraphrase moms everywhere: If your neighbor jumped off the Empire State Building, would you? Because the facts suggest that, financially speaking, your neighbor is likely atop a skyscraper right now, breathing heavily and nervously looking to the street. Americans are in more debt than they've ever been in. Granted, there are some people who make a lot of money, save a lot of money and spend a lot of money. But those folks are fewer in number than most of us realize. The reality is that Americans are so much in debt that when you see someone spending ridiculous sums, it's safer to assume they have little or nothing saved than it is to assume they actually have a high net worth. In short, the problem with keeping up with the Joneses is that the Joneses may be on a path to ruin, or at least a path that will have them worrying about money more than they need to.
Who are the Joneses?Another problem is that we don't know all that much about the Joneses. Perhaps they are sitting on a mountain of credit card debt. Perhaps, they inherited money. Perhaps they invested well. Perhaps, they spend a lot on their car or their landscaping, but they don't have a college fund or a 401(k). After all those Joneses are likely keeping up with other Joneses. Sometimes the Joneses in our lives aren't in our neighborhood but are on TV — a neighborhood without budgets, bills or debt, where police detectives live in multi-million dollar apartments, and furniture, clothes and cars are chosen based on how interesting they appear on screen rather than financial sense. The Joneses — in their many forms — create a lot of pressure to spend beyond our means. And the hard truth is that even if you keep up with some Joneses, there are always some more around the corner spending even more lavishly.
Can the Joneses be beat?Recognizing whether there is a problem is a good start. Examine your own spending for areas where you feel compelled to spend to keep up with the Joneses at work, on TV and in your neighborhood. Once this spending is identified, it's a matter of making the tough choice. Could this money be better spent to improve your family's financial security? In areas where you're still tempted to keep up with the Joneses explore cheaper options. Also, you can try to stay away from the Joneses. For example, just because you can afford to buy a home in a certain neighborhood, ask yourself whether you can afford the private schools, the fancy cars, and the expensive decorating that might come with such a neighborhood. And lastly, instead of spending more, look for opportunities to spend "better" than the Joneses. Discover the pleasure in giving to charity. Find satisfaction in building that deck yourself. Feel the security of paying ahead on your kid's college fund. Experience the joy of being debt free. You might not be able to keep up with the Joneses, but you can win in other areas. And isn't winning better than merely "keeping up?"
