The psychological fear that people call FOMO now drives consumer behavior through social media exposure at a time when everyone shows only their highlights. People feel pressured to attain luxury vacations and designer brands as well as the latest tech gadgets from what they view online. Today lifestyle loans serve as a rising financial tool which lets people fund their desired acquisitions. This growing trend in lifestyle loans between FOMO and finance contains unknown links while peer pressure remains a contributing factor.
Most people experience FOMO as a reaction when they believe others are having positive experiences without them. People develop FOMO because they make comparisons between others and themselves while seeking social inclusion. Social outings with people who enjoy lavish experiences create feelings of pressure to replicate these lifestyles even though financial circumstances might be insufficient to sustain them.
People use lifestyle loans to sustain their purchasing habits while buying optional items like travel experiences and luxury products and wedding-related items which they acquire by seeking financial support from other sources. Traditional home and educational loans have essential purposes whereas lifestyle loans center around quick satisfaction which increases their danger level when friends exert pressure.
Social media uses its platform to spread peer pressure beyond the boundaries of typical social groups. People tend to feel less than others because online content shows only carefully selected experiences but most users cannot match those activities in real life. These are the steps through which peer pressure drives people to adopt lifestyles that others display:
Comparison of Social Media
Over the years of endlessly scrolling through Instagram and TikTok, users were led to believe by highly curated posts that we all lived a glamorous life. This makes people take loans to match their acquaintances' social standing, experiencing others visiting such places and driving premium automobiles.
The Fear of Getting Lost
Material objects are closely linked to social status in the public imagination. People borrow money to maintain the illusion of financial success or prosperity in order to conceal their perceived failures.
Simple Loan Access
Traditional banks have pragmatically combined with dozens of fintech companies to offer easy access to lifestyle loans. And while emphasizing a desire for passion and forgetting about future financial consequences, fast approvals and lower initial interest rates make it hard to delay impulsive wants.
Culture of Celebration
A few things come up every time under this and excessive spending has been expected all through the life milestones — weddings, birthdays, vacations etc. People often take on costly debt because they believe there is pressure to throw “Instagrammable” events.
The Unspoken Risks of Lifestyle Loans
Lifestyle loans give you a momentary satisfaction from the borrowed money, but the long-term impact is a spiral of constant financial pressure. Here are some key risks:
The snare of high-interest debt
Many lifestyle loans come with high-interest rates, and people find it challenging to repay the debt on these loans because they do not have a repayment plan in place.
Instability in finances
Using borrowed money to spend on unnecessary expenses drain savings accounts leaving them needing to withstand a crisis that requires an emergency fund such as medical emergencies or unemployment.
Stress on the Mind and Emotion
So, those who are in some debt tend to experience agitation along with stress and sometimes depression. The anxiety over re-payment typically outweighs the original enjoyment derived from the purchase.
The Borrowing Cycle
The first point, long-term financial dependency, in other words, is that when people become dependent on loans to sustain their expenditure when they cannot save, then loans turn into new loans, creating an endless spiral of ever-increasing debt.
FOMO and financial problems would be a growing problem in our present day networked way of life. Lifestyle loans provide a temporary glimpse of happiness but lead to persistent regret. People who are aware of the effect of peer pressure on their life decisions can avoid undesirable debt and use their financial knowledge to raise their stable future. You must follow your goals instead of following goals that other people have to be financially independent
DEV-AASHISH CAPITALS PRIVATE LIMITED is a Non Banking Finance Company (NBFC) registered with the Reserve Bank of India (RBI). RUPEE112 is the brand name under which the company conducts its lending operations and specialize in meeting customer's instant financial needs.
