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Is the fear of missing out (FOMO) wreaking havoc on your budget? If you’re like most young adults today, you regularly scroll through an endless feed of highlight reels on social media. While it’s impossible to have and do it all, it can be tempting to try — even when you don’t have the means. But there’s a new trend called the joy of missing out (JOMO) that’s flipping the script. Here’s a closer look at FOMO vs JOMO, and money management tips that can help you take control over your budget.
What is FOMO?
FOMO refers to a feeling of fear that arises when you become aware, often through social media, that you might miss out on a rewarding event others are going to experience . For example, it can strike if a group of your friends are going to a party and you’re not invited or if most of your peers have the new iPhone and you don’t. But why is it so powerful? FOMO can be tied to fears that if you don’t do something, you’ll:
- Not be invited to a future activity.
- Feel like an outsider.
- Lose friends.
- Be judged.
- Not live your life to the fullest.
- Be seen as “less than” others.
Because humans are innately driven to belong to tribes and seek social approval, feeling like you’re missing out or left out can be a strong driving force. That said, it can be destructive if it goes unquestioned.
FOMO Spending Pros and Cons
While spending money to ensure you don’t miss out on something can alleviate some discomfort, it’s often a short-lived solution. For example, if all of your friends have Stanley cups except you, you may feel left out. To alleviate that feeling, you could buy one. But if your friend group bonds over shared material possessions, it’ll happen again and again. The long-term solution isn’t to keep buying stuff you don’t want or need but to find friendships where you’re accepted for who you are.
Letting FOMO guide your buying decisions can also get expensive fast. There’s an endless number of products and experiences you’ll encounter every time you visit a social media platform, turn on a TV, or leave your house. Trying to keep up with those around you is a quick way to hinder your future, accumulate debt, and damage your credit score.
What is JOMO?
JOMO, a new trending term, is an acronym for the joy of missing out. It suggests that instead of fearing the consequences of missing out, you find contentment in your own pursuits and activities. So instead of always chasing greener grass, you embrace whatever you are choosing to do. As a result, you can say no to products and experiences without regret. Perhaps because you’re saving money, sticking to your budget, catching up on rest, or doing something else that benefits you overall.
JOMO Non-Spending Pros and Cons
The JOMO concept comes with a few potential pros and cons. On the upside, you can exit the never-ending race to keep up with everyone around you. There’s a huge relief in accepting that it’s not possible or necessary to have everything everyone else has. It also makes it much easier to stick to a budget.
On the downside, if you lean too far into the JOMO, you can end up missing out on things you actually want to buy or do. For example, if you never say yes to invites from your friends or loved ones, your relationships can suffer. You may also end up feeling deprived if you over-restrict yourself.
Money Management Tips: How to Take Control of Your Finances
Leaning too far into FOMO or JOMO can be a problem. To strike a balance that helps you enjoy the now while planning for the future, consider taking a more logic-based approach.
“My top advice for young people looking to balance good financial habits with entertainment and enjoying life is just to establish a solid, flexible budget that allows you to do both,” says David Kemmerer, CEO of CoinLedger.
If you don’t have a budget yet, list your monthly income and monthly expenses — including all of your bills, debt payments, and recurring expenses like gas and groceries. If you’re having trouble tracking your spending and income, consider a money management app like EveryDollar or YNAB.
Next, figure out how much money you have left over after covering your expenses each month and how you want to spend it. This discretionary income is what enables you to plan for the future, pay off debt, and have some fun. Financial experts recommend you:
- Build an emergency fund: Work on saving three to six months' worth of living expenses in case you get sick, hurt, laid off, or face another emergency.
- Pay down high-interest debt: If you have high-interest debt, like balances on credit cards, work on paying them down. They often cost more than you can earn from investment accounts.
- Save for retirement: The earlier you can start saving for retirement, the more time interest will have to compound. Get started, even if you can only contribute a small amount each month.
- Save for personal goals: Think about what you want for your future and set savings goals. For example, a deposit on a rental home, a down payment on a house, or a down payment on a car
- Save money for fun: Set aside a bit of personal money each month for fun activities like going out with friends or treating yourself to a new outfit. If you don’t enjoy life, it’s easy to get burnt out and give up on budgeting.
“Lots of people are under the impression that budgeting means no more discretionary spending, but the best budgets still give you an allowance while simply cutting back on impulsive spending that can corrode your financial health over time,” says Kemmerer.
Once you have a plan in place, it can function as your north star. When you see something you want to buy or do, go back to your financial plan. Does it fit or not? If it does, great. If it doesn’t, consider adding it to your personal goals list, making some adjustments, or skipping it. By having a clear understanding of your means and what you’re working towards, you can stop FOMO in its tracks. While you may miss out on some things, you can do so with joy because you know you’re building the life you want.