My favourite chapter from David Chilton’s, The Wealthy Barber Returns, is the one where he offers four words of advice to someone who was spending too much money going out with friends.  Chilton said, “Sometimes when people ask you to do something, you’ll have to reply, ‘I can’t afford it.’”

It sounds so simple, but few of us have the will power to pass up the chance to go out with friends and family for fear of missing out.

Related: Why do we save?

Our spending habits are heavily influenced by the people around us and that can hurt our ability to save and reach our personal financial goals.

A consumer trends survey conducted by Capital One for Financial Literacy Month revealed that despite two-thirds of Canadians living on a budget, half of them feel they’ve lost control of their personal finances and it might have something to do with their relationships.

Constant pressure from peers to go out and spend can wreak havoc on your budget.  According to the study, it’s acceptable to avoid social situations that can put you in an awkward financial position without any social stigma, which jives with what Chilton preached in his book.

Children’s activities can also take on the feeling of keeping up with the Joneses.  Take hockey, our nation’s pastime, which costs parents just under $3,000 per year on average.  A Globe and Mail article discussed how hockey is becoming a game for the rich, and that parents are struggling to keep up with the rising costs.

It’s okay to be cheap

An overwhelming majority of Canadians (92 percent) said there are acceptable excuses to be cheap, such as when you’re paying off debt, saving for a home, and saving for a child’s education.

Related: The burden of debt

To avoid stress, not only do couples have to be on the same page but so do friends and family.  There’s no shame in taking some time to get your finances under control, and the more open and honest you are about it with your peers, the better.

My wife and I got into debt before we were married and it didn’t help that we spent far too much at restaurants and nights out with friends.  Once we curbed our spending on entertainment we were able to quickly dig our way out of debt, and our relationships didn’t suffer.

The most acceptable areas to cut back spending include groceries, going out with friends, buying gifts, and planning your wedding.  Interestingly, 76 percent of women are willing to cut back on wedding plans compared with 63 percent of men.

Speaking openly with your partner can signify a strong relationship, but disagreements about where to spend money can lead to financial infidelity, where spouses keep money secrets from each other, including lying about purchases.

Although 82 percent of Canadians in relationships say they speak openly and honestly with their partners about money, one-third say their other half’s spending habits have hurt them in achieving financial goals.

Related: Does your spending need tending?

Chilton said it’s not an admission of failure to say no on occasion – it’s an acceptance of reality and no big deal.

Their spouses don’t leave them.  Their friends still call.  Their retirement plans thank them.

Do you ever tell your friends or family that you can’t afford to go out?


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