Your social life is a valuable part of your personal happiness, as well as key support for your physical and mental health. It has many connections to your financial life as well. Thus, supporting your social life is incredibly important.
The big ingredients in a healthy social life are time and attention. Set aside some time and some attention for your social relationships and you’ll find that you’ve paid back with far more value than you ever would have expected.
Today in this article, we’re going to look at the social sphere and how it connects to one’s financial life.
- How Would you Describe a Social Life?
- How can you Have a Social Life on a Budget?
- Exploring the Connections Between your Social Life and Financial Life
- How can you Improve your Social Life?
- How can you Improve your Financial Life?
How Would you Describe a Social Life?
Social life simply refers to the time you spend with other people simply because you enjoy spending time with them and get value out of that time. It encompasses time spent with family, time spent with friends, and time spent in situations where you’re getting to know people.
Read Also: Here’s how a Money Buddy can Help you Reach your Financial Goals
This might seem like a common-sense definition, but there’s actually a lot going on here. Does social media count here? Does interacting with someone online count as actual “social” behavior? If so, is it weakly social?
There are many deep connections between one’s social life and one’s financial life. Here are a few of the key ones.
Not having a social life leads to negative health consequences and significant expenses. The social sphere tends to be one of the two areas of life (along with avocational) where people often let it dwindle until it’s almost gone, then lament the disappearance of that sphere. People are more lonely today than they have been in centuries (if not ever) and that decay of social lives has a lot of profound negative health consequences.
In short, if you allow your social life to drift away because you’re too engrossed in other areas of life, you’ll likely find at some point that you’re struggling with loneliness, and persistent loneliness is very problematic for one’s physical and mental health over the long term. Maintaining your social sphere inherently helps maintain your physical and mental health spheres, which in turn helps your financial life.
Your social circle deeply influences your spending choices. It’s often said that we are the average of the five people we spend the most time with. Well, that might not quite true, but we do believe that our closest friends and family members have a large impact on how we view the world, what things we’re exposed to, and what things we think about.
Thus, by extension, our social lives impact our financial lives by the spending choices we’re guided to (or away from) by our social influences.
We can get trapped in a desire to spend money to impress our friends and acquaintances, often those outside of our most immediate social circle. We want to “keep up with the Joneses.” We want to have the burst of social cachet that comes with having the cool new thing. We want to be the nicely dressed one in the group, or at least not be the one that is talked about as being “shabby.”
In truth, this is just the “spotlight effect” in action; because we think about ourselves so much, we over-assume how much others think about us. Yet, many of us find ourselves influenced by these thoughts, overinflating what others might think of us. It’s good practice to stop worrying what other people think and instead behave as we would like to be treated, but that’s often easier said than done.
Friends can help greatly when you need to borrow something or have a major task to accomplish (like moving). Friends can be incredibly useful when you need something in a pinch. Whether it’s a cup of sugar, a foot in the door at a job, a truck to haul a couch, or an afternoon of help getting ready to move, friends can make all the difference and keep you from spending money on services and products (and they’ll likely make the activity more interesting anyway).
Naturally, this comes with some expectation of reciprocation, so it means taking on a helpful role in the lives of friends as well.
How can you Have a Social Life on a Budget?
Enjoying an evening out with friends is a fun way to spend your time, but it’s also an easy way to spend your money. Sometimes more of it than you’d hoped. Drinks, dinner, taxi, event tickets, even late-night snacks? Before you know it, you could have emptied your entire wallet. If you’re trying to be budget-conscious and have other financial goals, social spending can really blow you off course.
But you don’t want to sit at home and sacrifice your social life for your savings account? Figuring out how to have a social life on a budget is totally doable. Whether you’re trying to get out of debt, struggling with a limited income or just striving to save more and spend less, follow these tips to learn how to save money and have a social life:
Be the event coordinator
No one wants to decline invitations again and again because of financial stress. Instead of waiting for (affordable) invitations to come to you, be proactive and propose your own, budget-friendly plans. This is key to having a social life on a budget.
Phoenix-based Athena Lent, who blogs at Money Smart Latina, shares one of her pro tips for how to save money and have a social life: happy hour. Instead of going out during prime dinner time for standard prices, hitting happy hour allows you to take advantage of lower prices—often for the same food and drinks.
Happy hour dining is a way to save money eating out at restaurants by driving down costs and the temptation to splurge on the most expensive menu items.
When friends do want to go out at night and you’re playing the role of event coordinator, Lent says you can suggest dive bars “because they are usually cheaper than the swanky new bar.”
She also recommends having a social life on a budget by planning outings to discounted matinee movies and finding fun things to do without spending money through free concerts and events held at local parks or venues. If the must-attend event is something beyond your budget, explore apps that can help you save on dining through discounts.
When your social plans call for spending, consider using an account that rewards you for your purchases. With Discover Cashback Debit you can earn 1% cash back on up to $3,000 in qualifying debit card purchases each month.
Open up your home
Spending quality time with friends does not require going out at all. Lent used to live at an apartment complex with a pool and regularly invited friends over to swim and hang out in the sunshine. Even if you don’t have a pool at your disposal, or that hot Phoenix weather, having a social life on a budget becomes easier when you can open up your home for other fun and engaging experiences with friends.
Amy Rutherford—a Denver-based early retiree who started the frugality and travel blog GoWithLess—used to eat out regularly. For her, having a social life on a budget now means inviting friends over to her home.
“There is a whole other level that is personal and intimate,” Rutherford says of playing host and sharing her home with others.
It’s become a key way she’s learned how to save money and have a social life. Plus, she prefers the relaxed environment at home where you can spend hours dining for a fraction of what restaurants charge.
“At a restaurant, there’s pressure,” Rutherford says. “If you want to hang out a long time, you feel like you have to order more. When you bring guests for a potluck at home, it is nearly free.”
Try new hobbies
Martin Dasko, founder of personal finance and lifestyle site Studenomics, lives in Toronto, one of the most expensive cities in North America. He used to go out (and spend) with friends multiple nights per week, but found it was really just because he didn’t have anything else to do.
If you’re struggling with how to have a social life on a budget and are in the habit of regularly spending on the same activities, explore new cost-effective hobbies. For Dasko, it made all the difference.
When figuring out how to have a social life on a budget, he took up wrestling. The activity has not only become one of his new social outlets, it’s also helped him make new friends from the gym. He also joined a salsa dancing club. Despite admittedly having two left feet, Dasko enjoyed dancing—“it was fun and different,” he says—and he made new friends as well.
If you want to learn how to have a social life on a budget, “join a gym, salsa club, archery club or some type of club where you can meet cool people and hang out with them,” Dasko suggests.
If you’re working on how to save money and have a social life and are interested in starting a low-cost hobby, look for local sports leagues that don’t require a lot of equipment, like kickball or beach volleyball. Hobbies focused on fitness, dancing and crafts are often easy on the budget. You can usually find local meetup groups and clubs to learn more and enjoy your new hobby with others.
If you’re planning to spend on your hobby, look for one with fixed costs that you only have to pay upfront, like membership fees and special equipment. You can also keep startup costs under control with used or entry-level gear.
The best strategies for having a social life on a budget may be easier than you think. You don’t always have to say no to fun activities, and you don’t have to feel like you can’t keep up with friends who always want to spend money.
Spending money, after all, is no guarantee of a good time, especially when you consider the stress it may cause when your bills come due. Instead, with the right attitude, a bit of creativity and a willingness to try new things, you can learn how to have a social life on a budget.
Exploring the Connections Between your Social Life and Financial Life
While many people often look at their social life with a very different lens than their financial life, you might be surprised to know how closely connected they really are. This connection applies whether you are highly social or not social at all – if you prefer meeting friends for dinner or going on a sunrise bike ride alone.
Your social nature is directly related to how and what you spend money on and what your true relationship with money is. Let us now explore this theory and help shed light on how, perhaps, some tweaks to your social habits may have a positive impact on your financial life.
Loneliness
Lack of social interaction can have a substantial negative impact on your physical health. According to the American Psychological Association, loneliness poses a greater threat to public health than obesity.
In a New York Times article, psychologists and psychological studies were reported to have found that loneliness can impair health by raising levels of stress hormones and inflammation, which in turn can increase the risk of heart disease, arthritis, Type 2 diabetes, dementia, and even suicide attempts.
With any health problems comes a cost, therefore, maintaining a healthy and active social life (especially as you age) helps to maintain your physical and mental health which in turn protects you from unwanted healthcare expenses.
Social Spending
Who you spend time with and what you choose to do with that time has a direct impact on your spending choices. If you surround yourself with people who are constantly “keeping up with the Joneses” or seem to find pleasure in spending as a social activity, then you will likely have the same negative habits.
By choosing to spend your time with people who can enjoy life and experiences in a prudent way, you are making a social choice that can help you stay on a strong financial track.
You Shouldn’t Have to Impress Your Friends
Much the same as social spending, feeling pressure to dress a certain way or have a certain car or house to feel connected to your group strongly suggests that the group is pretty shallow. It also suggests you may be spending too much time thinking about what others think of you.
Relationships that make you feel negatively about who you are, what you have, or give you negative self-worth are likely toxic. They also likely play a major role in some negative spending habits. Making a choice to spend time with friends that value your relationship over possessions may be a more rewarding option, and definitely better for your financial situation.
Friends Who Help
Having strong friendships with people who are willing to help you with a yard project or can loan you their Shopvac when you want to clean out the garage are great folks to have around. Not only are they willing to give you their time and resources because they genuinely care about you, but they are saving you quite a lot of money at the same time. In turn, they will reach out to you for help from time to time and you will be doing them the same financial favor.
A strong network of loyal and generous friends who will stand by you in hard times and celebrate you in good times is an invaluable part of the human condition. When there is a void in this aspect of our lives it can lead to loneliness or poor physical and financial choices.
It is important to develop a strategy for maintaining healthy social relationships and have activities that keep you engaged and energized, especially as you age. Here are a few recommendations:
- Make time for social activities – block off time on your calendar each week for social events.
- Make opportunities to meet people – whether you volunteer, join a group or take a class, be proactive in your endeavor to stay social.
- Plan social events – have a cookout and invite your friends, plan a trip to your local farmers market with your neighbors, find a concert or play you want to see and invite a few people to join you. People like to be invited and they will likely think of you the next time they have something planned.
- Help your friends – if a friend or acquaintance needs help (and you are capable of providing the help they need) make the offer. They will appreciate it and likely reciprocate.
A person’s social life is a cornerstone to personal happiness, physical and mental health and, as we have outlined, one’s financial well-being. Nurturing your social life can have a lasting impact on your overall well-being. Giving time and attention to maintain a healthy social life is the best way to live your life to the fullest.
How can you Improve your Social Life?
When we spend time with family, have drinks after work with friends, or even reconnect by phone with an old friend, we don’t need a scientific paper to tell us we feel great! Recent research by psychology professor Barbara Fredrickson shows that even casual positive interactions with acquaintances can cause a major lift in spirits.
And the more of these little happy hits we get, the better. In fact, relationships are so important in positive psychology, they make up the “R” in PERMA (the model of thriving developed by Dr. Martin Seligman).
We know that spending time with people we care about improves our well-being, and yet some of us may need a bit of a nudge to break us out of our hermit tendencies.
Here is your nudge, in six parts:
1. Invite a co-worker out for lunch
If someone is new to your workplace, make them feel welcome by inviting them for lunch. Or maybe you have the kind of office where most people eat while working at their desks every day. Gather a group together and go out one Friday—sit in the sunshine and chat about anything but work.
2. Meet a friend for coffee
We all fall into ruts and routines; we tend to see just the same few people over and over—often just our families and co-workers. What about that friend you like but never get around to seeing? Give him or her a call and arrange a coffee date. Catch up on what’s new while strengthening your relationship. Facebook is great, but nothing beats actual face-to-face contact for staying in touch.
3. Host a dinner party
Sure, this is a little more ambitious, but you don’t have to be Martha Stewart to have a few friends over for dinner. Start small with perhaps just four or five people. Make as much of the meal ahead of time as you can, and be sure you have enough essentials on hand, such as napkins, chairs and silverware—preferably not when the party is five minutes from starting.
If you don’t like to cook much, buy high-quality prepared food such as rotisserie chicken or cooked salmon from the market. Toss a salad, buy a baguette and some wine and you’re golden.
4. Join the club
Many studies, as well as anecdotal evidence, show that people who enjoy the sense of belonging and camaraderie you get from a group or community gain immense benefits in terms of well-being—even recovering more quickly after a stroke or other illness. It doesn’t matter if it’s a religious congregation, a book club, a sports team … getting together with like-minded people on a regular basis is good for your physical and mental health.
5. Go solo
Don’t let a lack of compadres stop you from hitting the town. So many restaurants now have counters or bars where you can comfortably sit as a single and watch the goings-on all around you. And even if they don’t, you have the right to occupy a table and enjoy a great meal as much as any family of six. Bring a book or tablet and read if you feel you need something to keep you occupied while you eat.
As for going to movies, plays or museums alone, for many this is the only way to go! Enjoy the entertainment and your own company, while at the same time putting yourself out there in the public sphere and inviting the possibility of meeting someone with similar interests.
6. Turn off your computer
The incredible conveniences of 21st-century technology are undeniable. Yes, you barely need to leave your house to buy pretty much anything under the sun. You can order up food to be delivered, and download movies right to your computer or TV. But doing so has a cost in human interaction, or lack thereof.
According to research from the University of British Columbia, even so-called “weak ties,” casual interactions like the kind that occur at your local Starbucks or corner market, are important for social and emotional well-being. (This dovetails with Barbara Fredrickson’s research, mentioned above.)
Instead of buying something online, go to a bookstore or record shop. If a store is independently owned, you have a better chance of real interaction and recommendations from the people working there.
How can you Improve your Financial Life?
When you think about improving your finances, you probably think of things that will take years to accomplish. Saving for retirement. Buying a home. Paying cash for a car. Making six figures. And then, when the long timeline of these goals becomes apparent, you get frustrated.
While your finances do include a lot of big, long-term goals like these, your financial situation is also comprised of many smaller goals, decisions, and activities that are much easier to manage. Because they’re small, it’s tempting to think that they don’t matter. But, here’s the good news: Taking care of the small things is what makes your big financial goals possible.
With that in mind, here are 10 things that you can do in an hour or less to improve your finances.
1. Switch Banks
If your bank is charging you a lot of fees or not paying competitive interest rates, you’re losing money. It’ll take less than an hour to research alternatives and make the switch.
2. Open a Savings Account and Fund it With Direct Deposit
If you already have a savings account, you’re halfway there. If not, find one with a great interest rate and set up an account. Then have your employer directly deposit $25 or more every pay period. If you can’t get direct deposit, set up an automatic transfer from your checking to your savings. The money will grow without much effort on your part and, chances are, you won’t miss what you’ve never seen.
3. Comparison Shop Your Insurance
At least once a year, take an hour and make some phone calls to other insurers to comparison shop. You might be surprised to find that you can lower your auto, home, or life insurance premiums by quite a bit.
4. Reduce Your Credit Card Interest Rate
Paying outrageous interest on your credit card? Call your card issuer and ask (politely) for a lower rate. If you’re a good customer in good standing, you can probably get the rate reduced. Ask for a supervisor if the first rep won’t help you.
5. Comparison Shop Credit Cards
Number 4 didn’t work? Don’t worry. There are tons of cards on the market, many with 0% or super-low interest offers on balance transfers. Check www.CreditCards.com for a list of cards that match the criteria you want, find your new card, and transfer your balance. Boom. You’re saving a ton of money in interest.
6. Lower Your Monthly Bills
Call your cable and cell phone providers and ask if you’re getting the best deal. New offers pop up all the time, so your current plan may not be the most cost effective anymore. If you’re aware of a better offer from a competitor, mention it. Your provider may match it. And if they won’t match, switch to the competition.
7. Lower Your Bill Some More
Comb through your bills and look for things you don’t use (or use enough to justify the cost), like premium channel packages, insurance or protection plans you don’t need, unlimited texting or data, subscriptions to papers or magazines you don’t read, and so on. If you’re not using it or getting your money’s worth, drop it.
8. Learn One Thing
It’s amazing what you can learn in an hour with a quick search online or a trip to the library. Find something about your finances that you don’t understand and figure it out. Maybe you want to know what an ETF is or whether you need life insurance. Maybe you don’t understand how credit cards calculate interest. Learn it. The more you know, the better you become at managing your finances and making good decisions.
9. Set Up an IRA or Contribute to Your 401(k)
You keep saying you’ll get around to it someday, so take an hour and set up an IRA at your bank or a brokerage like ING or Fidelity. Alternatively, sit down with your benefits manager and fill out the paperwork for your 401(k). Don’t worry if you can only afford a small contribution. It’s better than nothing and if your employer matches your contributions, that’s free money.
10. Find Your Biggest Money Drain and Plug It
Ever said, “I don’t know where it all goes?” Sit down with your bills and statements and figure out where your money is going. Do you eat out a lot? Entertain too much? Shop too often when you don’t need anything? Have a $10 per day Starbucks habit?
Read Also: How to Get Better with Money
If you’ve got a habit that’s costing you big money, find a way to plug that leak. Bring your own coffee to work. Brown bag your lunch. Host a potluck dinner instead of paying for everything. Find a free hobby to take the place of wandering the mall.
Not every financial improvement has to take years to accomplish. There’s plenty you can do to improve your finances over your lunch hour or in a spare spot of time on a rainy Saturday. The trick is to stop thinking it won’t make a difference and realize that even the little things add up to big bucks down the road.
Final Thought
Are you gearing up for your third Saturday night in? If so, it may be time for you to try to develop a social life and see how it connects to your financial life. Of course, getting a social life is easier said than done, and you may feel shy or nervous about making new friends and finding a new routine.
Start small by connecting with old friends, neighbors, and acquaintances so you can build your social network. You can also meet new people by joining a club or volunteering. Once you have a social life, maintain it by staying in touch with friends and being a good friend to those around you, and watch your finances while doing that.
