If you’re anything like me, the hardest part of saving money is your social life. You can be careful with your spending until you turn blue in the face and still have everything fall apart when your friends coax you into a pricey night out. So I will show you how to save money with friends. They probably won’t help you, but with this, they won’t manage to slow you down.
Today I will teach you:
- How we reached our savings goals
- Why your social life ends up being an unpredictable expense
- The one trick that always works to maintain your social life while saving money
- Why this will actually help you gain respect – not lose friends
Our simple strategy to hit our savings goals
Even though we live without budgets at FiveYearFIREescape, our family is very mindful about spending. This part is not a trick. It’s a mindset. We know about the benefits of frugal living and we have a big, crazy, lightning rod financial goal – to sail around the world with our family, and most random expenses just don’t compare to it.
We make a conscious choice multiple times a day about whether our money will be spent on some random knick-knack or will it be a contribution to our life’s dreams.
Sometimes the random expenses do win – I’m not going to lie. Sometimes we want to buy a really nice gift, go out of town for a change of scenery, or take our kids to that place where people dress up in squishy costumes. (And sometimes Lina REALLY wants a burrito.)
Yes, these things cost money, but as long as we feel that we made a conscious choice, we don’t regret it.
It all sounds great, right? Well, it is… except when your friends try to make it hard with their fun (and pricey) plans.
Why learning to save money with friends is really hard
The one place that always left us a little uncomfortable financially were outings with friends. It starts innocently enough. “Let’s grab dinner” someone will say. Now suddenly you are going to spend at least $50 without a chance to back out.
This is why it’s hard to save money with friends. You can’t control the way they think – or can you? (<– That’s a spoiler). I mean, FOMO (Fear Of Missing Out) is real, and you do want to hang out with them. What are you supposed to say anyway? (<–another spoiler, I’ll tell you what to say later).
It’s not your friends’ fault
It’s not a conspiracy. Going out for drinks or dinner is the status quo for most social circles. It never really seems like it would be a big expense, until you’re paying your bill at the end of the night, thinking of how cool it would have been to invest your money instead.
And of course, you’re spending money on the experience. On a good time. It’s a good way to spend my money, you justify – without even thinking whether there could be a better way.
The truth is, you should be able to have fun. Early retirement and super finances aren’t about sitting on your front porch reading the paper all day (actually, don’t read the news – its bad for you). And you shouldn’t have to find a whole new group of friends just because you decided to take the plunge into living without a nine-to-five.
If you did, you would end up befriending wierdoes like me!
You should be able to save money with friends but you can’t just tell your friends you don’t want to spend your money. Can you? (<– Another spoiler…yes you can).
The only trick that always works for us to save money with friends
So how do we get out of these costly outings and save money with friends without being lame? Simple.
We use this phrase:
No actually, we’re saving up for our next vacation, how about we get together at our place? We’ll cook a stir-fry!
Let’s break this down.
1 – Say no. Don’t waiver.
If you tell your friends ‘no’, they will peer-pressure you. I guarantee it. If they succeed once, then next time they will see you for the weak-floppy-fish that you are and push even harder. If you are an immovable object like a mountain from the first time, they will know, trying to push you won’t get them anywhere. This way you can avoid future peer-pressure.
Learning to save money with friends starts here. Fail and there is no reason to read the rest.
2 – Tell your friends a thing you’re saving up for.
we’re saving up for our next vacation,
It could be big or small, tangible or vague, whatever.
- A new car
- Beyonce concert
- A cool phone
- A motorcycle trip
I specifically don’t recommend saying that you are saving for FIRE unless your friends are very financially progressive. The phrase ‘I need to save up $2,000,000 to be able to quit my job’ likely will either result in laughter, confusion or the argument that one dinner certainly couldn’t hurt your goals (I hate that argument).
That one dinner can hurt you though. One dinner at a time FIRE will float away from you never to return.
We always found it best to relate you saving to something your friends would understand to spark some understanding and maybe even a little jealousy. Obviously, don’t lie to them, then just you’re a jerk. But your savings goal doesn’t have to be 100% true either.
If you’re saving for a vacation, no one knows how much you have to save or how long it will take you. This enables you to get quite a bit of mileage out of that vacation allowing you to save up and invest some money for your future. It’s all cool, it’s a little lie, just a tiny one.
3 – Offer a cheap or free alternative
how about we get together at our place? We’ll cook a stir-fry!
It could be a hike, a simple coffee, wandering the mall with no intention to buy anything (if you do this be strong!), or dinner at your place. Get creative, there are tons of things you can do for free.
We save money with friends by incentivizing people to come to our house for dinner. Usually, we either cook or have a drink supply. Groceries to cook are cheap, and beer from the store is a fraction of the price of what’s at a bar.
This way to save money with friends could go one of two ways
So what happens next?
Your friends could go along with it, or they could just ditch you.
If they go along with it, congratulations! You’re getting closer to your FIRE escape and you’re taking your friends with you.
If they ditch you for the night, don’t worry about it. You’re close to FIRE and there will be other outings. In fact, when you decree you’ve hit your savings goal, do something special and suggest something awesome. Your coming out will be its own special event and you should celebrate achieving things anyways.
The thing to remember is that you don’t have to say no every single time. And you don’t have to say yes every single time either. The important part is that you made a conscious choice. Tomorrow’s dreams vs today’s outing.
Prepare to get major respect!
This phrase is magical in that it’s so casual and easy and yet it demands respect.
First of all, you’re sharing your noble goals and everyone respects people who stick to their convictions. Or at least they should.
You’re not being a drag with I can’t afford it, the phrase that makes everyone feel a little bad – especially yourself. If you are close to FIRE you can afford almost anything. And saying you can’t, sucks and make you seem like a loser. Saying you have something better to do is awesome and gives you an air of awesome.
“Haha! You are saving for a 1-month vacation to Thailand. What a sucker!”
Can you hear someone saying that? No, of course not! It’ll be more like “Wow, you’re amazing! I want to be just like you. Oh Great One, teach me your ways!” I mean it’s probably what they will say…
Secondly, you’re offering an alternative. I’m sure most of your friends would like to save money too. But they also feel obligated to keep up with this social life and have some FOMO.
They probably also sigh at the end of the night when the bill comes and would welcome the opportunity to do something for free. They, however, have never stumbled upon the right blog to find the right words to do it.
Learning to save money with friends is about offering people a choice – a choice to join you on the FIRE escape – or at least not block your speedy exit.
TL;DR – Save money with friends
- Your friends can derail your savings plans.
- If you want to start saving money on social outings, use the phrase “No, actually we’re saving up for [something awesome], how about we [something cheap]” and become the FIRE genius among your friends.
- It will allow you to skip expensive events while still being friends AND sounding cool.
- It’s important to gain the ability to say no to some events, but you still can say yes to some fun things.
4 thoughts on “How to save money with friends: How to fight off FOMO”
I just found your website and I have a long way to go for financial independence. Did you write anything on tackling bad debt? I haven’t looked the whole way through your library but did find a couple posts that I found interesting and read. Any help is much appreciated. Thanks.
Welcome to the FIRE escape Ryan!
I haven’t written anything on tackling bad debt yet but my first few articles were on how to save, why saving is important, and how to motivate yourself to save.
I wrote them first because they are so important and they relate to paying down debt because everything begins with saving.
-The more you can save, the more you can use for debt-paydown (or later investing).
-The more you save the faster you are debt free
-The more motivated you are to save the more you will save.
If you have a dream of being debt-free, imagine it. Find a picture that embodies your vision, make it your phone background, then think about that vision whenever you are about to spend money (or turn down the ability to make more money). If you do those things you will power your way to debt-free life, then rocket on to FIRE.
Hi 5YFE! Great article and very informative. I like how you propose taking charge of the situation and dictating the terms of the night, cheaper suggestions like a home cooked meal in or even something as simple as a picnic on the beach etc are great alternatives to really spendy nights. Of course the age old ‘pre-drinks’ never gets old before going out, too!
Learning to pre-drink might have been the best education I got from college 😛
(j/k I loved school)