Money Talk with Nimi: The Jones’ are Broke!Posted on Monday, July 2nd, 2012 at 12:09 PM
“If it gives you any comfort, the Jones’ are broke. If you are busy trying to keep up with them, please stop. The Jones’ are probably trying to keep up with you!”
We live in a very materialistic world and sadly Nigerian society is one that increasingly seems to favor instant gratification over hard work. With a growing number of people living well above their means and images of beautiful people living extravagant lifestyles, decked in expensive designer clothing, and driving state of the art cars, it is no wonder that these images are affecting a young and vulnerable generation.
For young Nigerians, from the minute they graduate from college or university, the pressure is on. This segment of the population are sometimes obsessed with the need to have an attractive car, designer clothes, a job with a prestigious firm, and if they don’t have the money to live “the” lifestyle, they are increasingly prepared to lease, borrow and in some cases will even consider doing unscrupulous things to maintain a certain standard of living. Without having worked a day, some of our youth feel that they are nothing and will not be accepted unless their appearance fits the bill; they are tying outer image to personal value and self worth.
Where does the pressure come from?
There are a variety of factors that drive this mindset. Parents are a major influence on a young person’s attitude to money as they are natural role models for their children. As money management is not routinely taught in school, if their parents are poor money managers or exhibit an extravagant lifestyle of over-indulgence their children are likely to imitate them. The media and advertising naturally have a huge influence on spending patterns. Prolific advertising and product placements are so sophisticated that you are convinced that you must acquire the product.
Many young people interviewed however, say the greatest influence on their excessive spending was their friends who put pressure on them to keep spending even when they have run out of money. It is true that our friends do have some influence on all of us in what we do, but it is of grave concern if young people are being persuaded by their peers to spend money they simply don’t have. The trappings of success are becoming more demanding and expensive each day. “Necessities” now include designer handbags and shoes, trainers, the most expensive Brazilian hair, the latest smart phone or BlackBerry, or the largest flat screen television; and now the I-pad 2 has come unto the necessity list.
Who is paying for the shopping sprees?
This “must-have” culture is putting pressure on parents. Who is paying for the $1,000 handbags and the first or business class tickets for a young 21 year-old youth corper? As they strive to impress their peers with expensive clothing, jewelry and cars, parents are footing the bill to help their children keep up with the “popularity contest”. Whilst the children are still living at home, the problem can be papered over and ignored, but when they move out into the “real world” they often feel a sense of entitlement and try to keep up a lifestyle that took their parents decades to build.
Sadly many parents may unknowingly be jeopardizing their children’s ability to succeed, by over-funding them through young adult hood, and making it difficult for them to fend for themselves in later life. Overspending by this generation has damaging implications both for consumer debt and future savings habits and threatens their long-term financial health. As they build up debt from overspending when they are young, it could be a challenge for them to build wealth for their future. At such a young age, when they are just beginning to earn a salary and manage finances, it is vital to start to establish a good savings habit and enjoy the advantage that time brings to investing.
Who are the Jones’?
But who are the Joneses and why do so many people live their lives in fear of what they think and do? No one really knows who they are but they always seem to set the pace for so many of us. The expression “keeping up with the Jones’” is used widely today and dates back to 1913. The name “Jones” was chosen by the artist Arthur Momand as it was a common surname that highlighted the common nature of social rivalry and image consciousness. It makes reference to the desire to keep up appearances of affluence and wealth as others around us.
The problem of excessive spending is not limited to the younger generation; indeed they learnt it from us. We often equate the worth of a person with what they have acquired by way of money and material possessions, such as a house, a car, jewelry, how often they take vacations, where their children go to school and so on. If we are not able to keep up we then feel inferior on a socio-economic level. It has become a sorry way of life as it puts us in a precarious position as we fail to recognize that there is so much about the Jones’ that we cannot see; we are thus influenced by perceptions or what we “think” that they might have.
Keeping up with the Jones’ can creep into your life and you may have fallen prey to spending patterns that have increased your debt. Whilst debt can be an excellent tool when applied to acquire certain assets that are likely to appreciate in value, funding luxuries with debt limits your choices because you are constantly caught up paying for yesterday’s shopping instead of securing tomorrow.
If portraying an image of luxury is more important to you than acquiring long term financial freedom and security, there will eventually be consequences. Stop comparing yourself to others. There will always be people that simply have much, more than you do. If you constantly try to outdo them, you put yourself under overwhelming pressure and undermine your own future financial security. Particularly for young people who with focus and discipline have the potential to create lasting wealth over a long time frame with focus and discipline, it is such a waste to be distracted by the trappings of success; they are only trappings.
Stay focused on your goals and objectives
We live in a society where so many people appear to be competing instead of focusing on their own goals and objectives. The good news is that, thankfully, there are many young hard working, successful men and women who are aggressively seeking a healthy and prosperous future through discipline and hard work. Acquiring and maintaining long-term wealth is a process that usually comes without short cuts.
Look critically at your own particular situation, set your own priorities, and try to improve yourself, through self-development and education. Focus on what is really important to you and stop worrying about the distraction of what the Jones’ are doing. It takes courage and a lot of self-confidence to cope with peer pressure. Too many people learn this lesson the hard way by ending up in debt and with no savings. If it gives you any comfort, the Jones’ are broke. If you are busy trying to keep up with them, please stop. The Jones’ are probably trying to keep up with you!
Photo Credit: Max-Logic.com
Nimi Akinkugbe has extensive experience in private banking and wealth management. She is passionate about encouraging financial independence and offers frank, practical insights to create a greater awareness and understanding of personal finance and wealth management issues. She is married with 3 children. Find out more via www.nimiakinkugbe.com