Social media has greatly impacted our lives in several ways, including how we look at our spending habits and finances, driven by a plethora of new social media buzzwords related to financial planning. These terms may appear innovative and fresh, but they are often familiar concepts repackaged and modern attempts to justify our spending habits. It’s important to navigate these trends carefully, ensuring they don’t derail your personal financial goals. Working with a CERTIFIED FINANCIAL PLANNER™ professional can help keep you on the path toward your goals. In the meantime, let us assist you in mastering some of those buzzwords!
Here are some potentially problematic buzzwords:
Girl Math: “I returned something to the store, so now I have extra money to spend!” This could be true if you had your budget set up, if the item you are returning was within your budget, and if you will spend that money on a similar item. On the flip side, you could put that “extra” money into your investment savings account.
Spaving: “If I spend another $25, then I get free shipping!” The idea of spending to save only works if you truly need the extra item. Buying four of anything when you only needed two just to get a small discount might feel good at the time, but will it ultimately be worth it or help you reach your financial goals?
On the good side of the social media buzz terms:
Load Budgeting: “I am trying to pay off my student loans, so I won’t being going out as much.” Expressing to friends and family that you are prioritizing a longer-term financial goal over short-term impulse spending is a great way to hold yourself accountable while also creating a support group who can encourage you in achieving your financial goals.
Debt-Free Journey/FIRE Movements: In this trend, people share online their journey to becoming debt free, whether through working a second job or spending less and saving more, with the ultimate goal of being part of the “FIRE” movement. Participants in the FIRE movement, or the “Financial Independence, Retire Early” strategy often try to account for every penny of earned income, using any income remaining after paying required expenses to pay off debt as
early and quickly as possible. Once
the debt is paid off, the excess income is reallocated toward savings and investments to retire early.
Some neutral social media trends that are not inherently good or bad:
Budget my paycheck with me: When a person shares a video of their paycheck explaining how they split it between necessary bills, savings, investments and unexpected expenses. While the financial transparency and accountability can be beneficial, you shouldn’t compare your situation with others, as everyone’s financial responsibilities and situations are different. Better to create a budget that works for you to see how you spend your monthly and yearly income and identify where you might be able to cut back and save more.
“Man in Finance” trend: Someone “seeking a man in finance, who is 6’5 with blue eyes and a trust fund” as their romantic or life partner. While the idea of having your lifestyle funded by a partner may sound appealing, putting a plan in place to secure your personal finances might be a bit more realistic!
Buzzwords and trends may come and go, but taking control of your spending and financial future will never go out of style. A CFP® professional can help you build a budget and a plan that fits your style. Find your CFP® professional today.
By: Spencer Betts, CFP® spencer.betts@bickling.com August 2024
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