Financially flawed: 6.3 million Aussies go into debt trying to keep up with the Joneses
A worrying number of Australians are living beyond their means to improve their social status, according to new research by Finder.
A Finder survey of 1,062 Australians found 30% – equivalent to 6.3 million people – have felt pressured to make a purchase to match the lifestyle of a friend or family member.
The research found 1 in 8 (15%) – more than 3.1 million people – have gone into debt or spent more than they could afford because of the pressure to spend.
Shockingly, the average Aussie has spent $1,309 – $4.1 billion nationwide – beyond what they could afford in an effort to keep up with the Joneses in the past 12 months.
Splitting an expensive restaurant bill despite ordering less (14%), going on an expensive holiday (11%) and buying tickets to an event (10%) were the most popular expenses Aussies felt pressured into.
Buying a nice car (6%), designer items (5%), and even a house (5%) were all purchases Aussies have made to keep up with others.
Sarah Megginson, personal finance expert at Finder, said it is a very common and costly phenomenon.
"Everyone has different incomes and different priorities in life, but sometimes we're not as intentional with our spending as we would like to be.
"As a result, people are putting themselves in financial jeopardy, with some even taking on debt they can't afford to 'keep up with the Joneses'.
"Some people care deeply about how they appear and what the perception about them is, which can lead to some very unwise spending."
Megginson said 'comparisonitis' is heightened by social media.
"Never before have we had such an intimate and behind the scenes view into other people's lives – but it's important to remember it's a highlight reel.
"The millionaire next door might be drowning in debt to afford that apparent life of luxury."
Megginson said trying to keep up with others is a slippery slope, and it's always more fruitful to compare only against your own goals and needs.
"Getting into debt, ruining personal finances and compromising your values are all very real risks when it comes to trying to keep up with what others have.
"Success isn't defined by what you have or where you holiday.
"Focus on future wealth by paying your debt off and dedicating more money to investments and savings than to material possessions," Megginson said.
| Have you gone into debt or spent more than you can afford to keep up with friends or family the past 12 months? | |
|---|---|
| Yes | 15% |
| No | 85% |
| Source: Finder survey of 1,062 respondents, June 2024 |
| Have you felt pressured to do any of the following with friends and family in the past 12 months? | |
|---|---|
| Pay for someone's baby shower | 3% |
| Pay for someone's bucks/hens night | 5% |
| Buy a house/apartment | 5% |
| Buy designer items | 5% |
| Buy a nice car | 6% |
| Buy concert/festival/sporting event tickets | 10% |
| Go on an expensive holiday | 11% |
| Split the bill evenly at a restaurant when you ordered less | 14% |
| None of the above | 70% |
| Source: Finder survey of 1,062 respondents, June 2024 |
Methodology
- Finder's Consumer Sentiment Tracker is a monthly recurring nationally representative survey of more than 60,000 respondents.
- Figures in this release are based on 1,062 respondents from June 2024.
- The Consumer Sentiment Tracker is owned by Finder and operated by Qualtrics, an SAP company.
- The survey has been running monthly since May 2019.