Money FOMO: When you scroll through social media today, it seems everyone is living a luxurious life—sometimes a trip abroad, a glimpse of designer clothes, and unboxing videos of new gadgets. These images create a sense of unease within us: we feel left behind or lost in the fray. Rohit Mahajan, founder and managing director of Plutos ONE, has labeled this effect “lifestyle inflation.” He says that the constant show-off and comparison have blurred the lines between “need” and “want.” Just as every Instagram Reel, every Tinker-Talker video, pushes us toward a “must-have” attitude, it’s not just lifestyle inflation but digital peer pressure.
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What is money FOMO?
Money FOMO—Fear of Missing Out on Money—is the feeling of fear or unease that others are earning, spending, or living a better lifestyle than they are. This fear leads to rash spending or investment decisions based on ostentation rather than need. This feeling is particularly exacerbated by observing others’ expensive lifestyles on social media.
How is Money FOMO Growing?
India has approximately 690 million social media users, meaning nearly half the country’s population is active online. Their timelines are flooded with limited-edition products, influencer endorsements, and brand promotions. In this scenario, social media, once a source of entertainment, has become a race for show-off and spending. A 2024 survey revealed that 64% of millennials and Gen Z make impulse purchases based on social media, and 93% of shoppers are influenced by trends. 84% of people complete purchases directly on social media platforms. These trends are driving up credit card bills, reducing savings, and increasing financial stress.
Algorithms, BNPL, and Spending
Social media platforms use algorithms that make us feel jealous, anxious, and FOMO. Furthermore, services like mobile payment features, one-click checkout, and Buy Now Pay Later (BNPL) are introduced at a time when our excitement is high. While BNPL offers customers the option to pay in installments, it practically becomes a form of debt. Failure to repay installments can lead to increased late fees and interest, impacting credit scores. According to data from fintech companies, BNPL usage has increased by nearly 30% among millennials. Millions of “haul videos”—where people show off new purchases—showcase this trend on social media, further fueling this trend.
How are we being affected?
This digital pressure is not directly, but subtly, affecting our spending decisions. For example, when a friend or influencer is hanging out at a cafe and shows it in a Reel, we suddenly feel the urge to go out. Or when a new gadget goes viral, we buy it impulsively, not after careful consideration. These small decisions happen repeatedly, and over time, our spending habits change. As a result, we often end up spending beyond our means.
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How to avoid this trap?
To break out of this trap, it’s important to give yourself a 72-hour cooling-off period before any unnecessary expenditure. This reduces the tendency to make impulsive decisions. Additionally, monitoring your monthly expenses and setting a clear savings goal is very beneficial. Resetting your social media feed is also an effective step—follow some accounts that promote minimalism, financial education, or mindful living. This will help you understand the true value of money. True style isn’t about buying expensive things, but about managing your money wisely. Social media should inspire us, not pressure us.