Everyone knows them. The people that seem to be always living large. They have all the new cars, the newest toys, the most extravagant vacation, and the beautiful house. How do they do it? How are they killing it at life while you’re counting pennies and hoping that you can pay all of your bills? The truth is, how do you know if they’re killing it? Sure, it might look like they have everything under control, but you don’t know the truth about their situation. Maybe they are killing it, but maybe they have a boatload of debt and are just hoping the credit collectors don’t find them. How do you avoid comparing yourself to them and how do you stop yourself from becoming them?
Avoid comparing yourself to anyone:
Very few good things can come from you comparing yourself to others. Keep reminding yourself of this. Everyone’s situation is different and without having full access to people’s bank accounts there is just no way to truly understand their financial situation.
Things are not always what they appear. If you’ve read The Millionaire Next Door then you know that millionaires are not usually the people with the flashiest stuff. They tend to blend right in or even appear to be financially worse off. After all, driving that older model car is how they save money versus buying or leasing new cars every few years. That isn’t to say they don’t have nice things because they certainly do, but if you’re looking at someone who has the newest of everything chances are they aren’t managing their money in a way you should envy.
Comparing yourself to others will not make you feel better about yourself. If you feel like the other people are better off than you, you’ll feel jealous and maybe even second guess your values. If you think you are better off than the other people, you’ll pity them or feel like a real jerk for comparing. Either way, no good can come from the comparison.
Stop trying to keep up with the Joneses. Your situation is yours and no one else’s. You shouldn’t measure how well you are doing in your life based on how well other people are doing. This will just lead to frustration and disappointment. People can’t tell how much money you have or how on track you are to reaching your financial goals unless you’ve told them so there’s no reason you should be able to tell someone else’s situation.
How to you keep yourself from becoming someone who looks successful, but in reality is not?
Stop caring what other people think. You are who you are. If people do not like that, then their opinion shouldn’t matter to you. Budgeting and personal finance is a journey, a process. You don’t just start and magically everything goes perfectly and you’re a sudden millionaire, so beat yourself up for where you are in the process. It’s also highly personal. No two people are in exactly identical situations. Your goals and your challenges will be different from other people’s, not better or worse, just different.
Have a budget and do everything you can to stick to it. Budgeting will help make sure that your money is going towards things you value and bringing you closer to your big picture budget goal. Not sure where to start with a budget? I created a printable Basic Budgeting Bundle that contains 19 pages of material to help you start a budget. Trying to budget and it just isn’t going well? Keep trying. When you start something new or try to learn a new skill like budgeting, it’s highly unlikely that you’ll be perfect at it right away. With practice and perseverance, if you keep going and keep trying to budget, you can achieve your goal.
Don’t spend more than you earn. This is a basic principle that will help you have financial success. You always want to have more money than bills. This will allow you to work towards your money goal no matter whether that is paying off debt, saving more, saving for a big purchase, or investing. By spending less than you earn you will have the freedom to choose what is important to you and what you want to spend your money on. Find yourself buying things you don’t need? Ask yourself if the item will bring you happiness and don’t buy it unless the answer is yes. Another way to keep purchases in perspective is to figure out how many hours of work it took you to earn the money you’re about to spend. Is that new TV really worth 100 hours of work? Or is your current TV good enough and your money can be used for something that’s more important to you?
Make sure that every time you get a raise or start earning more money you don’t start spending more too. This lifestyle creep will slow you down from achieving your goals.
Care more about your values than about how you look to others. Work to reach your goals and buy things that align with your values. You should not consider how you look to others. If you focus on making yourself happy and achieving your goals it does not matter what anyone else thinks.
What it really comes down to is making sure that you remember why personal finance has the word personal in it. You should not compare yourself to others financially or really in any aspect of life unless you’re using it as motivation to achieve your big picture budget goals. The truth is, you will never truly know what someone’s situation is. Their life may look perfect from the outside, but you just don’t know what their struggles are or what might be going on under the surface. You need to focus on your situation and achieving your goal and ignore what other people have going on. You shouldn’t feel pressured to purchase something just because someone else has it. You need to make your own choices and take steps to reach your goals so that you can find happiness.