Friends With More Money
The last thing you should do is try to compete with your friends
The years after college graduation sometimes bring an awkward discovery: Your friends may have far more money to spend on social activities and possessions than you do. Perhaps your first job after graduation offers a meager paycheck while your closest friends start earning big bucks straight out of the gate. Or, you finish school with a mountain of debt while your friends have none. Such financial disparities can “create a lot of awkward moments and put a strain on otherwise healthy relationships,” says Dalton Conley, a sociology professor at New York University. Additionally, many twentysomethings turn to credit cards to help fill the void while others withdraw from costly activities. Conversely, wealthier members of your circle may begin resenting their lower-earning cohorts because they can’t keep up.
How do you cope with losing financial footing with your friends? First, acknowledge that you don’t earn as much money as your friends — and resolve to live within your means rather than move into an apartment you can’t afford or go out to posh restaurants three to four times a week. Relying on credit cards to keep your friendships afloat is a huge mistake. Make it your policy to pay in cash. That way you won’t be tempted to overspend. Additionally, if you’re all putting money into the till for dinner, there’s no shame in not splitting the bill evenly. If you ordered water, for example, you shouldn’t have to split the cost of your friend’s mojito. Installing ground rules may help alleviate some of the financial friction in your relationship. For instance, if you travel together, decide upfront on a collective vacation budget. You might also be more assertive in organizing less costly activities and outings which can defuse some of your money anxieties.
Despite these efforts, your well-heeled friends may become interested in activities that you simply can’t afford. Rather than begrudge them the opportunity to spend how they see fit, be mindful of your own situation and don’t necessarily join the spending parade each and every time it comes around. It’s hard to admit when you can’t afford something, especially since money and status are so closely bound. Saying no, understandably, becomes more difficult when the expenditure looks more like an obligation. But if you can’t financially swing a flight to Hawaii for a friend’s “destination” wedding, for example, you shouldn’t go. If your friends are true, they’ll understand.
