MY MONEY

How to avoid trying to keep up with the Joneses this Christmas

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In 2003, two psychologists (Brosnan and de Waal) conducted a famous and hilarious experiment with Capuchin monkeys exploring the concept of fairness.

Two monkeys were placed side by side in separate, translucent plastic cages, and were asked to do a simple task for a simple reward. If they give the researcher a rock, then they get a slice of cucumber. Simple.

When they are both getting this cucumber as a reward the monkeys are very happy to perform this task many times over. However, as soon as one of them got a grape as a reward for effort (a far richer, sweeter reward in the mind of the monkey), then the other one receiving the cucumber throws the cucumber back at the researcher.

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Once again the researcher rewards one with a grape and the other with a cucumber and the monkey who missed out on a grape hurls the cucumber piece back at the researcher, rocking the cage door and going completely ballistic inside the cage.

The cucumber as a reward was fine while there was nothing better to compare it to, but as soon as it felt unfair, based on a comparison with what another monkey was getting, it all went south very quickly.

People don't act that differently, primarily because we have a part of our brain that is very similar to that of the Capuchin monkeys: a reactive, emotional part of the brain that measures our success and what is fair based on those around us.

When someone else at work gets a pay rise, we feel like we also deserve a pay rise and get upset if it doesn't happen. When our siblings buy a big new house, we want to get a bigger new house to show we are also successful. When our neighbours get a big new boat, we suddenly consider what we can buy to show that we are more successful than our neighbours. It's the classic 'keeping up with the Joneses' routine.

With 2020 being an emotionally draining year, and COVID-19 limiting our spending opportunities and scaring a lot of people into building up some cash reserves, our ape brain has never been more tempted to throw off the financial shackles and give in to the peer pressure.

It's not just emotional exhaustion. Peer pressure is very hard for our inner ape to resist as it connects with our core identity and self-worth.

The more our ape brain desires validation from others, the more susceptible we are to the pressure—and before you discount yourself as not falling prey to this instinct, ask yourself if you have ever felt a twinge of jealousy or sadness when friends or family have lost more weight, done a luxury kitchen renovation, had more a glamourous friend job, or had the fastest and most expensive car?

We all have felt this at some stage, because we are all human with a deep instinctive connection to the idea of survival of the fittest.

As with all psychological constructs, this instinct is often helpful in motivation and progressing society forward more generally, but it also has a dark side when we spend too much on keeping up appearances. Nowadays it's so easy to spend in the moment, instant gratification and delayed pain, that it's more important to keep our ape brain in check.

Here are five steps for resisting peer pressure and staying in control of your finances.

1. What would X do?
Think of someone you respect and simply ask what they would advise you to do? All you then need to do is learn to listen to that advice!

2. Downward comparisons
When you feel compared to someone that is doing better than you, think of others that you are doing better than. By creating downwards comparisons we feel less threatened and are better able to count our blessings rather than our shortcomings.

3. Sleep on it
Take some time to remove yourself from the emotion of the moment. The bigger the purchase, the slower you should go.

4. Like yourself
Being confident and comfortable in your own skin lessens the need to draw validation from others, and less susceptible to peer pressure and less likely to spend in order to keep up appearances.

5. Reframe
When only see the successful, good bits of others, try to think of the reality of their situation and realise that no-one leads a perfect existence. A healthy dose of reality can help tame our inner ape and make us more grateful and compassionate.

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Phil Slade is a behavioural economist and psychologist and the author of Going Ape S#!t! and founder of Decida. He works across digital innovation, strategy and cognitive bias.
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