Monday, 18 July 2011

Friends and the social side of money

There's a worthwhile article on finance and friendships.  It gives some good tips on how to manage the different income levels, spending habits and financial goals that exist across you and your friends.

Some key points in the article:
#1: Peer pressure can be mostly internal and comes from a desire to fit in.
#2: Explain your goals to friends.  This way your friends can help you to do good rather than pressure you into spending on things you don't want.
#3: Budget for social spending: Set aside a fixed amount each month for going out with friends.  This way it won't hit you as a surprise when you go out.
#4: Don't keep score: Do not keep an eye on what others have.  Focus on relationships.  Asking yourself why you don't live in a mansion like your friend will do you no good.  Life is not a competition.  Your goal in the end is to do what's best for you.

The full article is short and it's worth reading:

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