Money FOMO: How social media is quietly draining our wallets

A 2024 YouGov survey reveals, 64 percent of Indian millennials and Gen Z admit to impulse buys triggered by social media posts.

In an age of endless scrolling, a FOMO over wealth and savings has gripped netizens, leading to the anxiety for some that everyone else is living it large with foreign vacations, designer wardrobes and gadget unboxings, while their bank balance is not enough.

Social media doesn't just showcase these images, it weaponizes them to turn aspirations into impulse and comparison into debt. Rohit Mahajan, Founder and Managing Director of plutos ONE, a payment infrastructure entity called this the ‘lifestyle inflation’.

“The constant cycle of aspiration and comparison has blurred the lines of necessity and desire. Each influencer reel or luxury haul creates an emotional need to ‘keep up’, not realizing that most of what is viewed is paid content, staged or credit fuelled. What we are witnessing is not just lifestyle inflation but digital peer pressure in disguise,” Rohit Mahajan said.

The Rise of Money FOMO

The timelines of India’s over 692 million social media users - nearly half the population – are flooded with Amazon hauls, limited-edition drops and influencer endorsements screaming urgency. What begins as harmless entertainment morphs into a consumption trap, where likes equal lifestyle benchmarks.

A 2024 YouGov survey had revealed that 64 percent of Indian millennials and Gen Z had admitted to impulse buying triggered by social media posts. Studies further indicate that 93 percent of shoppers see their preferences shaped by trends, with 84 percent completing purchases directly on these platforms.

This can often lead to large credit card outstandings, eroded savings, and financial stress.

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Algorithms and the Impulse Trap

Algorithms are engineered to spark emotional highs - envy, excitement, FOMO – and paired with mobile payments, one-click checkouts and Buy Now Pay Later (BNPL) schemes, they can create a perfect storm for overspending.

BNPL allows a buyer to break up payments into instalments, often with ‘zero cost’ claims, however, it is crucial to remember that BNPL is a loan, and missing payments can result in late fee, interest, all of which can potentially impact your credit score, thus your credit worthiness.

Data from fintech players shows a 30 percent on-year jump in BNPL usage among millennials, likely fuelled by staged ‘luxury hauls’ or paid promotions.

A digital peer pressure too manifests in subtle ways, as reels of a friend’s cafe-hop may spark an unplanned outing, or a viral gadget reviews can lead to midnight cart additions, all of which, over time can lead to lifestyles beyond means.

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Breaking the Cycle: Practical Defenses

Breaking free requires deliberate counter-measures and implementing a 72-hour cooling-off period for non-essentials, to let the impulse fade, said one wealth planner.

Mukesh Pandey, Director of digital personal finance company Rupyaa Paisa advises prioritizing saving over spending.

“To defeat 'Money FOMO', monitoring monthly spending via finances apps and having specific saving objectives,” said Mukesh Pandey. Moreover, filtering one’s social media feed to subscribe to minimalists, finance educators or mindful living influencers to can reprogram the perception of 'value', he added.

The Real Flex: Financial Wisdom over Flash

Ultimately, social media should inspire and not deplete. The real flex should not be flashy spends but financially savvy behaviour, which should lead to scrolling with skepticism, and spending with intent. For true wealth emerges from sound saving habits and not in chasing hot trends.