How Social Media Is Making You POOR

The reason people are spending more money now than ever.

Here's what I'm reading:

Throughout history, people have always been pretty bad with money; however, in the last 15 years, it seems like people are spending more money than ever. Many people are spending money in extremely irrational ways, which I believe is because of social media.

In this video, I explain how social media can make you poor. And hopefully by understanding some strategies used on the internet, you can become more aware and save money.

"5 Ways Social Media Affects Your Spending Habits."

1. Bot Majority Opinion

It is estimated that over 52% of users on the internet are bots, which are often used to carry out very malicious tasks. One of the biggest tasks that bots do is create an artificial majority opinion to influence individual decisions. We will often use reviews or comments to help sculpt our opinion or decision about something; however, this is a bad thing to do because oftentimes these comments or review sections have been manipulated by bots to create an artificial majority opinion. This opinion could make you spend more money on things.

2. Tribalism

The internet is often about meeting like minded people who share similar values and interests. When we finally find our "tribe" on the internet, we often make decisions based on how members of our tribe are making decisions. This can cause people to make really irrational decisions with their money. Instead of buying something because it is what we want to spend our money on, we buy it because other people are influencing our decisions. Having huge devotion to a "tribe" could make you spend more money on things you don't actually want.

3. Rich Standard Of Living

Social media has allowed us to see into the lives of others. The lifestyle that algorithms push out the most is the lives of the rich and famous. It is the lives of people who live very superficial lives. When we consume a lot of this type of content, it distorts our view on what is a good, "Standard of living." When you're constantly comparing your normal life to the lives of rich people, it makes you feel like you have a low quality of life. It gives you an unrealistic, unnecessarily high standard of living to strive for, which, ironically, lowers your quality of life due to going in debt.

4. Peer Lifestyle Comparison

Oftentimes, on social media, we compare where we are at in life to our peers on social media. You might see a peer who is making a lot of money with a big house and it can make you feel behind in life. When you are constantly comparing your lifestyle to that of your peers, it often makes you feel like you need to spend a lot of money to keep up with your peers. The common expression for this is, "Keeping up with the Joneses." Constantly comparing your life to your peers not only makes you feel bad about yourself, but it also makes you spend a lot of money.

5. Insecurity Overload

People have always been bad with money; however, how people are spending their money now seems to represent increased anxiety, depression, and insecurity. Social media often makes people very insecure about themselves and when people are insecure, they are more vulnerable to spend money. It causes people to make irrational decisions with their money. It is important to take breaks when you're feeling insecure so you are able to think more rationally.

** Links above are affiliate links where if you click and order, I will receive a commission at no cost to you. **

[rntt]

Not just poor, social media makes me miserable. Actually, I'd argue the vast majority of the internet development that has happened over the last 15 years has destroyed society. I don't have any friends, haven't so much as had a date in about 6 years, and overall just hate the current state of affairs.

[TheArnaa]

I had friends who looked like they had an amazing life. Lovely home, multiple posh cars, holidays away etc. I was envious watching them have all the things my limited circumstance kept from me. Then the midden hit the windmill and it turned out it was funded by being in debt up to their eyeballs. It was a big lesson for me—I don’t have a lot, but I have a safe, affordable place to live, food on the table and all the necessities of life without debt. I don’t get envious anymore when I see people with a high lifestyle because I now appreciate having enough for my needs.

[gailtester]

Peer Comparison... I am caretaker to my husband who has Parkinson's and we have a beautiful home and a beautiful simple life, but when I went on FB I felt bad because my peers were traveling all over the world in their retirements. I quit FB because it made me feel I was missing out. When I didn't go on FB I was completely happy and content with our simple life. Also, regarding Insecurity... I used to watch some YT videos on women over 50 and how to not look frumpy and they were always triggering me to buy the cool white sneakers, or the trendy blazer, etc. I unsubscribed from them all realizing they were making me feel insecure about my perfectly nice wardrobe... I guess that is also tribal... to be a cool woman over 50 you need these sneakers. Ridiculous! Good video Augustine!

[Luncheon]

What I've seen is that social media makes me feel poor even when I have enough money... because it leads me to compare my house, my car, my possessions and my entertainment options with those that influencers have, which is way beyond my budget. To avoid jealousy and discontentment, I think we should avoid looking at what others have and stop wanting what they possess.

[adriansherlockdamondark.]

20 years ago, I read Rich Dad, Poor Dad. In it, the author says rich Dad was the one with the old car and the second hand furniture. This is why my furniture is crappy and old. But I bought my house and I have a lot of free time to enjoy life. I'm extremely choosy about what I spend money on.

[rsg]

I feel that sometimes the more often people feel the need to show how wonderful their lives are on social media, the more dissatisfied they actually are with their lives.

[melmjetset]

i just got a small windfall of $ & instead of buying something like shoes or clothes. I heard u in my head say "Intentional living & slow living" so I went straight to the bank & paid off a credit card. Yay for small wins & your content!

[danicegewiss]

I have a love hate relationship with social media. I ordered a coffee maker. It lasted over 10 years. I got it on clearance and checked Amazon for the reviews. A lot of people complained about the water reservoir. We liked it. We have heard so many good things about the brand. We were impressed. The reviews made no sense. I like buying one and done products. I use a Motorola cell phone. It's cheap and does what I need it to. No kids here....just pets. My pets were rescues. My peers are broke. I'm not. My life is good overall.

[pcorriveau]

That’s exactly why I left Facebook. Also, the lack of real conversation with most people… Great content as usual, thanks for this video!

[caraa.]

Old lady here. Even before the internet and social media, hyper consumerism was rampant. Opted out early, no kids by choice, home paid for by 35, retired comfortably at 50. Frugal habits did that on an income of 30, 000 to 40, 000 a year. I pity youngsters who can't discern between influencers and serious research necessary for any product. You seem well grounded. Hang in there.

[AnnMitt]

I deleted my FB & IG accounts because I could no longer tolerate the lies and marketing bs. YouTube and Twitter (for stocks discussion) are all that I have now, and I'm happy with both.
Love your videos, Austin. 👍

[IsauraAbreu]

This exactly why I decide to focus more on me and less on other people ! And it took me time to understand that my life it’s different from others and that my goals are not others peoples goals, and also that what makes me happy might be something totally different to someone else. Focusing on my has allow me to create boundaries about the things that I chose to influence my life! As always great vid. Thanks Agustin!

[nikiintampa]

Good god, Austin. I think you just hit the nail on the head on what started me down this long debt journey. I'm 51. I'm in debt. Been in debt since my mom approved my first Sears credit card at the age of 18. "It makes you feel behind in life that your peers are better than you." For me - this started around 13 years old when I saw that the friends I had lived better than me. That they lived in affluent communities and drove nice cars while I rode to school with friends, lived in a modest and comfortable house with one-parent income. I dated these richies. And my whole goal in college was to finish it so I can make money so I can buy nice things and be just like them. And I have been living like this since for 30+ years. I'm so glad I found your channel. And I'm so glad that once and for all, I'm taking control of my money so that I can afford to retire comfortably in 12-15 years.

[Paul]

Superb video Austin. I’d love you to do one about specifically about hobbies and how consumerism exploits our insecurities about needing the latest or best gear to do the hobby. For example my main hobby is landscape photography, it’s very hard to watch anything on YouTube without coming away feeling like current photography gear is inadequate or the barrier to taking better photos, when in fact the main barrier is being stuck in a 9-5 and not being able to practice and learn more. 😆I’m sure this is the same for many over hobbies too. I bet there are people out there working extra hours to pay for equipment they didn’t need rather than just getting out and using what they already have.

[Tabletfreak]

You have changed my mindset so much in a positive way ☺️

[Leeanne]

You are exactly right, its ridiculous. The kids nowadays are being influenced badly by social media.

[Miguel-eotd]

Not being on Instagram has drastically reduced my anxiety, and for that reason it is worth it for me to remain away from it and focus on bettering my life in every aspect. I’m much happier now. YouTube is amazing though, I love to learn.

[nicolaanderson]

All of these comments prove how society really feel about social media and the way the world is going. All comparison and competing. I could never go back on social media. It’s tainted with rotteness. Great video

[HangNguyen-ihrf]

So true. Most of my impulse speding are from seeing influencer using a product.

[itsHeatherKay]

Austin- I recently discovered a ton of joy and satisfaction that came from culling my belongings and putting limits on what I allow myself to buy/keep. I look at categories of stuff as “collections” like in a gallery, and I’m the thoughtful, creative curator. I would love to hear anything you might add to that idea.