We all know comparison is the thief of joy. But is your habit of comparing yourself or your life to someone else’s costing you in a more tangible way?
As in, costing you actual dollars and cents?
If you’re like most people, the answer is probably yes — because comparison is one of the leading reasons why we overspend and bust our budgets.
The Thing You Forget When You Start Comparing Yourself to Others
Comparing yourself and what you have to other people and their possessions can be a death trap for financial progress.
Why? Because you have no idea what other people’s inner financial lives look like. But that’s something we tend to forget when we practice our comparison habit.
You can look at someone’s beautiful home, carefully-appointed furniture, all their great new stuff, and the fancy cars in the driveway and think, “Wow. If I only had that kind of money I would feel happy and successful too.”
What you forget is that just because someone looks rich doesn’t mean they’re wealthy. Owning things and material possessions does not equate to actually having money.
At the very least, those people don’t have that money anymore. They spent it on the stuff!
And a more likely scenario? It’s really, really easy to be surrounded by stuff… while drowning in debt.
Looking Rich Isn’t the Same As Being Wealthy
The more someone acts rich, meaning the more they buy and spend, there’s a good chance they’re less likely to actually be rich in terms of meaningful assets and accumulating wealth.
That should be obvious. Again, if you spend all your money, you won’t have any in the bank!
Wealth is not the stuff you can show someone else. Wealth is your appreciating assets, your nest egg, and your ability to spend your time and energy in the way you want.
But you can get caught up in looking at symbols and signs of status to inform you about how “well off” someone is or isn’t. You compare, and you find ways that you come up short.
Then you feel bad about yourself, your finances, your life.
That doesn’t put you in a good mindset to take the necessary actions to create and build wealth. It can become a self-fulfilling prophecy that way.
It can get even worse when those feelings do inspire you to take action… but not the kind of action that helps your financial situation.
Is Comparing Yourself to Others Goading You to Overspend?
Some of the biggest financial mistakes I see people make are caused by their comparison habit.
They look around and see what their peers are doing. They look at how someone they aspire to be lives their lives. They check out what kind of cars their coworkers drive; what kind of houses other family members are buying.
And they want to keep up. Who wants to feel like they’re falling behind compared to someone else? So people spend to do just that: to maintain appearances of “keeping up.”
To an extent, I get it. It’s really not fun to be the only person in the neighborhood who drives a 20-year-old Honda even if it works perfectly well when everyone else is cruising around in their Audi. It doesn’t feel good to be the only person in the office without the latest gadget or piece of tech.
It’s completely valid to feel like you need to keep up or to fit in. Maybe a really expensive car isn’t a “need” itself, but we do all have a true human need to belong, to be part of the community or the group.
In many times, it’s that need we deny when we ignore what other people are doing and branch out to do our own thing. That’s why finding and following your own path is hard — and why, even when we know better, it’s a lot easier to overspend to buy what everyone else buys so we can keep our status as insiders.
But you have to remember: this is the comparison trap. It’s a trick that will cause you to overspend and fail to meet your own financial goals.
Refocus on what matters to you; focus on what you can control.
If you stopped looking at what others had and just focused on you, would you still feel the need to buy the latest clothes, electronics, cars, and so on?
Or would you want to focus on your priorities and what actually makes you happy?
Break Free and Focus on What Actually Matters
If you can focus on you, your values, your goals, and your priorities, you will get clearer on what you truly want and care about.
And I guarantee that’s not stuff like fancy side tables or a closet full of overpriced clothes or whatever other accessories you can buy for your house, your car, or yourself.
The stuff that matters is likely more along the lines of…
- Ability to spend your time how you want
- Your family
- Your community
- Work that’s important to you
- Making a difference in someone’s life
- Creating or building new things
- Innovating or learning
- Traveling and other experiences
We just need to remember the truth about spending on material goods: they don’t make us happy.
Spending on stuff (or worse, spending on what you think you should buy based on what other people think or say) won’t make you happy.
It usually causes the opposite: unhappiness. Dissatisfaction. A constant feeling like there’s not “enough.”
The people who are most satisfied, both personally and financially, are people who don’t need to spend to fulfill anything within themselves.
Before you get caught up comparing what you have, or don’t, to someone else, it might help to remember a few things:
- You don’t really know what’s going on behind the scenes of someone else’s financial life… or personal life, for that matter. People who appear happy might be dealing with some dark stuff that you don’t know about.
- Spending money to keep up with other people is not going to make you happy. It’s going to make you miserable, and probably broke too.
- Focus on what you care about because you care about it.
Focus on what you can control. That means you, your money, and how you use it.
You’ll not only make progress toward financial success that way, but you’ll probably also end up happier and more satisfied in the end.