Fear of appearing ‘tight’ fuels UK overspending
While most of us can empathise with the feeling of overspending on a night out or social occasion, new research among 3,000 UK adults from the Money Advice Service has shown that 48% of the nation admit to falling into debt as a result of their social lives. The average ‘social debt’ among this group is £1,260, with 56% of all UK adults saying they usually spend more than they plan to on social occasions.
Fear of appearing less-than-generous in front of friends is fuelling much of this debt with 58% worrying about appearing ‘tight’ or ‘stingy’ in front of others, and a third of all adults (32%) admitting that this contributes to their overspending when out.
A lack of self-control is a key reason for ‘social debt’, with 36% simply ‘getting carried away’ and overspending. Social pressures add to this with £341 spent on average a year solely to avoid looking ‘tight’ or ‘stingy’. Consequently, one in five people (20%) have cut back on food due to their social spending, and one in ten (9%) have not been able to pay utility bills.
Pub pressure
Many adults say they get a raw deal when it comes to spending on social occasions, but a fear of looking tight stops them from saying anything. Two-thirds of all people (67%) buy rounds of drinks expecting to spend more than they receive back. It seems the fear of social stigma could be well-founded – 35% think people who don’t buy rounds at the pub are ‘stingy’, while over a third (34%) feel they are simply being ‘rude’.
Not wanting to make a meal out of it
When out for a meal, a third (32%) of adults feel they lose out by paying for more than they have eaten - just a quarter (26%) say they split the bill based on what each person has had when out with friends, with six in ten (59%) saying they’d feel ‘uncomfortable’ suggesting this.
No money…no problem?
Not being able to say ‘no’ to a night out or social occasion is also fuelling ‘social debt’; a quarter (25%) say they go on meals out that they can’t afford, and 17% have been on a holiday or break in the last year which they didn’t have the money for.
However, when people do try and control their spending, over a third (35%) feel positive about being sensible, 33% feel great about not wasting money, and one in five (20%) feel proud of themselves.
Responding to the findings, Jane Symonds, a Money Expert at the Money Advice Service, says:
“Most of us spend a little more than planned every now and again, whether it is buying a few more drinks than we expected to on a night out, or getting a taxi home at the end of the evening.
“I’d urge anyone in debt, due to their social spending, to take action now to avoid getting any further into the red and instead work at clearing it. You’d be surprised at how empowering saying ‘no’ can feel when you see how healthy your bank balance looks, and you can spend the money on things you really value or need.
“The Money Advice Service has some really useful tools on its website which can help plan your social spending, including a Budget Planner, and a Cutback Calculator, that shows how much money you can save by making a few simple changes to your lifestyle.
“And don’t forget – having fun doesn’t have to mean spending lots of money. A great tip is to do a search online for free things to do in your area – you might be pleasantly surprised by what’s on and the range of activities you can do without spending a single penny.”
Jenni Trent Hughes, Social Psychology Expert adds: “These days we often find ourselves pressured into spending money we don't really have and buying things we can't really afford. The more confident you are, the more in control you will feel, and the less likely you are to fall into the trap of spending money you don't have to impress others.
“It’s really easy to be swayed by peer pressure, become carried away in the moment and spend money that the next day you wish you still had in your bank account. If you’re honest and clear with a friend about why you can’t afford to spend money on something and you still find yourself being put under pressure, it’s perhaps time to have a quiet word with them or even rethink the friendship - real friends wouldn’t pressure you to do something you really can’t afford.”
Tips from Jenni Trent Hughes, on avoiding spending more than planned without looking ‘tight’:
1) Be up front, honest and confident: If you can’t afford a trip or holiday your friends want you to go on, you really need to be upfront and honest – both with yourself and your friends. Make a firm decision to give it a miss and be confident you have made the right call for the right reasons. If you are open and honest with your friends about your decision, then no one will think any less of you.
2) Take cash: Help avoid a free-spending attitude when out or attending an event by setting a budget for yourself when you're at home and sober. Whatever the amount is then take it in cash and leave your card at home. It will make you keep track of your spending, and most people are likely to find they spend less when they are using ‘real money’ instead of paying on card.
3) Don’t get carried away: On a physical level, alcohol impairs your judgement, meaning you are likely to make less sensible decisions. Much of the time, overspending occurs from simply getting carried away as your decisions are fuelled by alcohol and it ‘seemed a good idea at the time’. On a night out, intersperse alcoholic drinks with water to help you keep your judgement and avoid spending money which you’ll likely regret the following morning.
Advice to help you make the most of your money
The Money Advice Service offers free, and impartial advice to help people keep track of their spending and make the most of their money – including practical online tools such as the Cutback Calculator: moneyadviceservice.org.uk/cutback, and a useful Budget Planner: moneyadviceservice.org.uk/budgetplanner