Sara, a 50-year-old working professional, was in a car accident. She suffered some serious injuries and submitted a claim for permanent partial disability benefits with her insurance company. Her personal physician had already provided detailed documentation. But her insurance company requested her to attend an examination with another doctor, provided by them. This doctor, they said, is an "insurance doctor." Now, this was something new to Sara. But is it a new concept? Let us find out. Who Is an Insurance Doctor? Insurance doctors play a critical role in the insurance sector, which is quite underrated and misunderstood. Most of us assume that they actually replace the role of our treating physicians, but that is not the case. Our physicians treat us in case of any mishap, but they do not assess or evaluate our level of injury or disability. But then, who actually does it? This work is done by Insurance doctors, which, in turn, impacts or affects our insurance benefits. Th...
Social Media - Wealth Building Or Wealth Display?
Social media is the digital playground where we shape our identities by connecting and sharing. It’s where we scroll endlessly, liking, commenting, and soaking in a world that often feels larger than life. We use it to build our personal brands and also stay in touch with our family and friends, along with following our favorite celebrity figures.
We get mesmerized in its glowing screens, spellbound by picture-perfect lives or people, flawless beauty standards, and luxury vacations. Such situations create the Fear Of Missing Out (FOMO) in our minds, compelling us to do things based on others' activities.
What if this is applied to financial decisions? It will lead to potentially damaging and unfavorable effects, all for the sake of some likes and comments. Thus, it is important to break this chain reaction and be smart enough to understand what is actually good for us and what we should avoid.
How is social media affecting your finances?
In the current scenario, social media is definitely influencing our finances, either directly or indirectly. What is important to understand is that the effects are both good and bad.
First, let us analyze the positive effects:
- There are several Financial Influencers, or Finfluencers, as they are called, who are actively participating and encouraging financial education. They have successfully normalized monetary discussions on public or social platforms, which have made the topic of money matters essential and relatable to the current generation. So, talking about finances and making our own decisions related to the same are not considered taboo anymore, as would be perceived by our previous generations a few years back.
- Financial literacy is important. It opens our minds and helps us realize the fact that it is crucial to save and invest not only for ourselves but also for our future generations. It also helps us decide the right financial products or avenues to invest in, after proper analysis of risk and return. This fact is being revolutionized by social media and finfluencers.
- Social media is also a platform where people can share their financial mistakes and how to rectify them. Honestly, someone's mistake can be taken as a lesson by someone else, to avoid that same problem in the future.
But as already discussed, all is not so rosy between social media and personal finance.
So, here are the negative effects:
- Social media is constantly exposing us to lifestyle inflation, or the tendency to be overwhelmed by the “perfect” existence. We imitate the trends, and copy styles, and curate our feeds to match an illusion that isn’t always real. Such feeds typically include flashy and luxurious vacations, designer and extravagant dresses, and parties that mask the struggle behind them. Such unrealistic perceptions greatly impact our spending habits, curbing savings and investment ideas.
- From the above point, we can derive the fact that excessive spending leads us to often borrow money to keep up with social appearances. Thus, we tend to fall into a debt trap created by the hype and show of social media. The consequences are dangerous and quite difficult to control.
- Our future goals and financial planning go for a toss. A student might have plans to accumulate money to go and study at a prestigious university. But if he or she falls into the trap of a glamorous lifestyle and high living standards, influenced by social media, then they may end up sending the entire amount that was supposed to be utilized for education and personal development. Since they start living in a world full of illusion, they fail to understand that spending on education is sustainable but spending on extravagant lifestyles is not.
- Social media is also a source of information related to hacks and quick methods to make money. Unfortunately, there is no shortcut to earning a good living. Guaranteed return on certain types of investment is another alarming topic that social media often promotes, forcing people to put money in fraudulent schemes and investment options.
- Financial comparison is another negative influence of social media. This creates a feeling of inadequacy or insufficiency and finally a low self-esteem. This creates an urge to buy things that are beyond our means, which brings us back to the same old problem, which is overspending.
How to reduce the negative impact?
Now let us come to the discussion of how to reduce the negative impact of social media on our financial and investment decisions. Here are some interesting ways to do so.
Focus on yourself - The simple fact that your life and future are in your hands gives you the freedom to choose between a world of fantasy and illusion or reality with a stable, financially independent life. The best way to make the correct choice is to educate yourself and inculcate the ability to judge which investment ideas acquired from social media are suitable for you.
Judging the usefulness of products - What is useful to a celebrity may not be useful to a person coming from a middle-class background. Therefore, before hitting that "buy" button, evaluate what the product is going to cost you and how often you will use it.
Balance spending and saving - You should always try to maintain a balance between spending and saving because setting money aside to achieve long-term financial goals will give you a stable future rather than spending for momentary happiness by flaunting expensive things.
Advice from finance professionals - Take the help and advice from finance professionals. Confirmation of knowledge gathered from social media by licensed experts helps in channeling finances in the right direction, primarily because they have the responsibility to act in the best interest of their clients.
Control over time spent on social media - It is best to limit the time that you give to social media scrolling. This will allow you to spend more time for yourself, your work and finances, your family, and overall healthy habits.
Conclusion:
The above discussion highlights that social media is not the evil or the villain of our lives. The problems arise when we use it negatively. It is best to maintain a balanced approach while using social media because it is also a source of good learning that can be used in different aspects of our lives. Professional expertise can provide us with the necessary guidance to streamline our finances and inculcate positive behavior regarding investment decisions. Social media not only connects us, but it also shapes us. So ideally, we should use it, not allow it to use us.
Read more:
Comments
Post a Comment