To Change Your Financial Life, You May Have To Change Your Friends

Your mom used to say it: you become like those you hang around. Dr. David McClelland of Harvard said it, too: people cannot change who they are unless they change their primary reference group. The Bible says it: bad company corrupts good morals. I’ve heard motivational speakers say it a different way: you’ll be the same person you are today except for two things, the books you read, and the people you meet. I would add one other thing that will change your life and your financial picture here in the 21st Century: the web sites you frequent.

We all know it’s true. We are profoundly influenced by the people with whom we spend the majority of our time. And now, in the Internet age, you spend a great deal of time with people you’ll never meet in person.

Empty WalletSo who are you spending time around? Whomever it is, that person can have a profound impact on your financial life for good or for bad. Friends, family, and co-workers may not have the same ideas on spending as you do. When you spend time with them, you can find yourself tempted to mimic their spending habits “just to keep up.” Your best defense against the spender is to go with them to places where you don’t spend money or where there isn’t a chance to spend a lot of money. Go hiking, go on a picnic, go bowling, go for a drive in the country, invite friends over for a potluck dinner. Find ways to enjoy life without the constant drain on your finances.

I’ve had to wean myself away from certain people who think that money comes in the form of plastic and that it’s just free for the taking. One day very soon, that plastic will turn into handcuffs and the days in the fun-house will be over.

It doesn’t just apply to personal finance either. The same principle can hold true at work, at social gatherings, or even family get-togethers: Does your attitude change when you’re around negative people who think the boss is out to get them? What about your attitude concerning your community or even toward other family members? Don’t let the negative attitudes of others infect you. The best way to combat this situation is to smile, nod gently, and either change the subject or excuse yourself to go somewhere else.

I’ve begun limiting my exposure to certain people because of their rampant negativity. In their eyes, nothing is right; no one understands them, everything they see is wrong, and the people in charge are just stupid. When I’m around these people, I find myself getting negative as well. I find myself worked up and agreeing with them. These people are very nice otherwise and can be fun to be around, but when they flip the negative switch, it’s almost more than I can take. I have to just walk away.

You might actually lose a friend over their out of control spending. If this is the case, realize that you weren’t important in that relationship at all, only the money was important, only the collection of things. You were interchangeable. Knowing this doesn’t make it any easier, though. Though you should never give up hope on another person entirely, you don’t have to spend your limited amount of discretionary time with them either.

The second question: What web sites do you frequent on a regular basis? Sites that offer encouragement in the face of failures will always lift your spirits. Read this posting from Gather Little By Little, especially the comments. It took a lot of guts to admit some of his recent missteps but his readers encouraged him to dust himself off, get back on his horse, and get started again. THAT’S the encouragement we all need. Click through your feeds and bookmarks to ask yourself, “Do I get positive support by reading this site?” Trim accordingly.

Spending time on sites that promote complaining and disharmony will cause you to feel these negative emotions as well. I encourage everyone to stick with those sites that stimulate discussion without going negative. That is a rare trait in this world today. Everyone goes negative sometimes, but when it’s a way of life, move on for your own mental and emotional health.

Lastly, what rich, mental protein are you putting in your mind through reading books? Our minds need the inspiration that comes from printed material which causes us to think, to ponder, to explore within ourselves, to make positive changes, to shore up our weaknesses, and to capitalize on our strengths. Don’t waste your time on schemers, on get rich quick strategies, or on shady propositions that force you to compromise your ethics or core beliefs. If you value people, don’t engage in programs that force you to look at them as potential profit centers.

If your philosophy about your finances has changed but your friends haven’t or if they just aren’t on board with your newfound understanding about how your money works, you may have some serious choices to make. Don’t evaluate your friends on the basis of whether their beliefs identically match yours, but DO evaluate whether they are your true friends or if they only need you to validate their personal habits and motivations. Don’t judge them since their money should be spent the way they want. But you don’t have to participate and enable them either.

Prune away those web sites that don’t lift you up and give you ideas on how to improve your life. Does it really matter what politician did what to whom? Does it really matter what celebrity got arrested? Isn’t your time and mental well being more valuable than that?

Read books and articles that help you move more quickly toward your goals. Several personal finance writers have listed their favorite books. Check out Get Rich Slowly’s 25 best books about money, and The Simple Dollar’s 52 books, 52 weeks – A Buyer’s Guide. Check these out from your local library or buy them from the book seller of your choice, but get yourself started on a regular reading program soon. Your brain cells need the exercise!

Finally, choose your friends wisely. Don’t leave this to chance because who you are and who you will become will depend on your primary reference group. Chose wisely.
[tags]personal finance, life, money, friends, choices, books, Internet[/tags]