What’s the Impact of Social Media on Your Savings Rate?

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It has been a busy few weeks for me as I am acclimatizing to a new and much busier job. In addition, Wedding tasks have been getting done and I was in need of some downtime. So the blog was put on hold.

I am also going to be needing to write another actuarial exam (Thanks Canadian Institute of Actuaries) so my posts may slow down over the next 2 or 3 months.

Onto today’s subject of social media and its impact on savings. Well isn’t this a challenging subject!

Some would say there is a great pool of knowledge available online through blogs, selective online news resources and unique value-add applications. People swim through this vast pool for inspiration, a greater understanding, and to try their hand at the whole DIY mentality. All true and positive!

But there is most certainly a dark side to social media that we’re all aware of that propels ultra consumerism, creating wants and fake needs. It can also possibly lead to having more anxiety, depression and other horrendous side effects. This post on the BBC discusses a bit further (I note the data is self-reported and will hold biases).

This is the side of social media I wanted to post about.

Wikipedia definition of Social Media

Social media are interactive computer-mediated technologies that facilitate the creation and sharing of information, ideas, career interests and other forms of expression via virtual communities and networks. The variety of stand-alone and built-in social media services currently available introduces challenges of definition; however, there are some common features: Social media are interactive Web 2.0 Internet-based applications. User-generated content, such as text posts or comments, digital photos or videos, and data generated through all online interactions, is the lifeblood of social media. Users create service-specific profiles for the website or app that are designed and maintained by the social media organization. Social media facilitate the development of online social networks by connecting a user’s profile with those of other individuals or groups.

Personally, I’m on a few…Facebook, LinkedIn and WordPress. But my interaction is fairly limited, and I keep away from Instagram, Twitter, SnapChat and all that Jazz. I think Instagram is the worst.

My personal opinion of Instagram is that it epitomizes comparison – people spend hours looking at these unrealistic lives showing a sliver of a moment that could all be a setup. Instagram thrives on bias. We get caught up in benchmarking ourselves against others because, well, people love benchmarking. And social media platforms are an easy way to select a massive sample of the most bias accounts out there!

We do it in our personal lives, in business, and in social media feeds. It’s everywhere and it’s how we measure ourselves – very rarely do we measure self-gains and progress. Very rarely do we actually set goals based on what we want.

Most of social media just isn’t rational and it leaves people feeling depressed and hopeless. It makes you think, for a moment, that you should have more luxury goods or useless crap in your life.

I don’t have any stats, just anecdotes, but I see it in my own circle of friends, the impact of social media benchmarking – creating a buyer mentality, and resulting in poor savings rates. This in turn has people working longer and longer hours, possibly at jobs they hate, to support buying habits perpetuated by unrealistic comparisons on social media. Not to mention it makes most people feel miserable.

Do what you want, it’s a free country. But I’d suggest stopping and thinking about the real impact it’s having on you and exploring alternatives to spending your time! Within social media, you can be more selective and thoughtful about where you want to spend your time and energy as well.

 

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