The cost of friendship

The cost of friendship: How your mates influence your spending habits

There’s an old saying that goes: ‘You are the company you keep’. Essentially, this means that a lot of who you are and what you stand for, is reflected in your closest relationships.

And that makes complete sense, right? We can’t choose our family, but we can choose our friends and we’re likely to be attracted to people with similar interests and temperaments, those who make us laugh and those whose company we enjoy.

But here’s something you might not know…. Your friends can also influence your spending (and saving) habits.

Yes, really. More than you probably realise.

Money personality

What’s your money personality?

Let’s look at the various types of ‘money’ personalities.

Firstly, the miser, otherwise known as the ‘tightwad’.

The person who constantly watches the pennies, keeps the wallet in the pocket and is keen to scrutinise the lunch bill and make sure that you always split the costs based on what you each ordered. Someone who does not easily part with money and is careful with every cent.

Then there’s the Spendthrift. They friend who earns a good living, or has money behind them and so really, money is never, ever a problem. They spend what they like without having to consider the consequences too carefully.

Then there’s the friend who has a bad case of ‘Affluenzer’ and who is eternally committed to living it up, finances be damned! Always spending more than they earn, in debt up to their eyeballs, and still not overly concerned. Usually, these people live by the motto that ‘now’ is all that matters and the future can take care of itself.

Your money personality

Then there’s the friend who is always broke. Who always needs to borrow, and perhaps rarely pays you back.

Perhaps this friend is an eternal student, or passionately following a dream, working for a non-profit, not earning much. But you know the one. The one who never has quite enough money for anything.

If I missed any here let me know – but in my experience, these are the four most common.

And they can each influence the way that you live your life, and how you spend your money.

Trying to keep up with the Jones’ will not make you happy, and taking pity on mates who can’t afford some things certainly won’t help YOU get ahead. In my experience there are usually two reasons why people are carefree or hopeless at managing money. Either they’ve always had more than enough of it and have never been taught the value of saving.

Or – and this is the far more common scenario – they don’t really understand how it can work for you, instead of against you. And there’s no shame in that. Finance can be complicated, and these are not skills we’re taught in school. While the curriculum is changing, so too is the world of finance, and it pays to get professional help to navigate this increasingly complex landscape.

Cost of friendship

Because, when you understand finance, it stops being scary or boring … instead, it offers opportunity.

With the right advice, you can put a financial plan in place.

I believe wholeheartedly that anyone can change their financial circumstances, it just requires commitment, a bit of know-how, and a good ‘money coach’ – someone who is happy to share their knowledge and experience and offer ideas and options for budgeting, saving, for your super, insurance and perhaps investments, that you may not have considered before. Small, incremental steps can make a big difference over time. But, back to the subject of friendship.

Your besties will understand if you skip brunch and just meet up for a coffee, or suggest a BYO and pizza night instead of a Friday night out at the clubs, because you’re committed to saving a bit more and spending a bit less, especially on things you can do without. After all, it’s the time you have together that matters the most, not where you hang out.

Types of ‘money’ personalities

While you don’t need the support of your friends, it certainly helps!

Good buddies will hold you to account when you’re wandering the shops and those super cute shoes or that adorable handbag catches your eye. Or will happily suggest you catch up during $10 Schnitzel night at the local instead of the fanciest restaurant in town, because they know you’re trying to save.

And be on the lookout for those mates who tend to make you spend more than you really want to. They can completely blow your budget!

Ultimately, money, sex, politics and religion are subjects that even the closest of friends disagree on so if you don’t feel comfortable talking about your finances or your goals with your friends, then don’t.

But don’t be afraid to go your own way either … in the long run you’ll be glad you did.


The information contained in this article has been prepared without taking into account your individual objectives, financial situation or particular needs – it is GENERAL ADVICE ONLY. Before acting on any information in this article, I recommend that you consider whether it is appropriate for your individual circumstances.

Need more information? Get in touch with Step Up Financial

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      Orange, NSW 2800

      PO Box 2499
      Orange, NSW 2800

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