A question I am asked repeatedly relates to financial peer pressure, being asked to spend more than you would like to on something, and knowing how to respond. Here’s the situation:

Friends are going in on a gift (or a trip or anything else) and suddenly it’s becoming significantly more expensive than you estimated or imagined. Most often, when this question comes up, the concern is that while you technically CAN afford it, the cost is exceeding your budget or what feels reasonable to YOU. While you COULD spend the money, doing so doesn’t align with your values – whether it seems over-the-top, more than you bargained for, or money that could be spent on something more important to you.

These friends don’t want to say, “I can’t afford it” because technically they can. But then again, I could take a loan against my 401(k) and buy the most elaborate baby gifts in the world for my best friend (well, not the most elaborate – Beyoncé is spending $500k on a nursery for her soon-to-be twins), but you get the point. I could afford something over-the-top, but doing so would sabotage many of my other goals and values.

So, how do you handle these situations?

Here are a few suggestions:

  • Be upfront, from the beginning, about how much money you can contribute.
    • Example: Your friends are going in on a gift for someone and ask if you want to contribute financially, saying they will handle the shopping and wrapping. This will save you a lot of time, so you excitedly say, “Yes, thank you! I’m in!” Before long, you receive a Venmo request for $250 and feel obligated to pay it even though $250 far exceeds what you were planning to contribute. Next time, try saying, “Yes, I’m in for $50. Let me know if that’s a problem. Thank you!”
  • If you feel you can’t contribute financially, simply let them know while ALSO suggesting ways you CAN help.
    • Example: Your friends are hosting a party for a friend, but you don’t feel you are in a position to hand over cold hard cash to make it happen. Instead, try saying, “I would love to help. I could bake a dessert for the party or help with all of the set-up and/or clean-up. Would that be helpful?”
  • Say, “No, thanks. I’d rather not.”
    • Example: You’re asked to go in on a surprise plan for someone, but it doesn’t seem like something you want to be a part of or can offer enough of what is being asked of you. Try a simple, “No, thanks. I’d rather not.” You don’t owe anyone an explanation. Give what you can give, on your terms. That may mean contributing with the group, or it may mean doing your own thing.
  • Say, “I can’t afford it.”
    • Example: You really want to join a tennis club and are told it costs $125/month, only to find out it costs about $180/month once all of the fees are included and also requires a one-year commitment. Simply thank them for the information and let them know you can’t afford it. Yes, actually say those words: “I can’t afford it.” From my recent experience, there is power in saying these words. By willingly saying you can’t afford something, it gives you a sense of control over your money. You can’t afford X because you are choosing to spend money on or save for Y instead. It doesn’t mean you’re broke (necessarily). It means you have a plan for your money, and not everything fits into that plan.
  • Do your own thing.
    • Example: If you’re going on a trip with friends, you don’t have to participate in every excursion or go out to every restaurant they do. If you’re going to feel left out but also can’t afford it, maybe it’s not the trip for you. If you can enjoy the trip AND the activities you plan for yourself, go! And have a great time! We’re adults. Spend your time and money the way you want to.
  • And finally, don’t be stingy. Be reasonable. Remember all of the generous things people have done for you.

What do you think? Do these suggestions help? What tips would you add to the list?

One final note: Gifts and surprises and adventures are not about out-doing each previous gift or adventure. What you can give today should not be the metric for what you need to give the next time. As our lives change, so too do our resources of time, money, talents, etc.


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