Spending Plans Get ‘Loud’ Thanks to Social Media

Paul Fain, CFP^®

A friend’s 25-year-old daughter recently asked me if I had heard of “loud budgeting.” I confessed unfamiliarity with the term but discovered it has been drawing a lot of attention on social media.

According to CNET Money’s website, “Loud budgeting is a financial strategy that puts your money aspirations front and center for friends and family to see.”

For most people, budgeting is a dreaded if not avoided exercise. We don’t teach it in schools. Spouses don’t talk about it. It’s not “cool.” So, in my book, anything that promotes a) creating and monitoring a spending plan (a budget); b) sets boundaries for accountability; and c) involves family communication is a good thing!

Loud budgeting is about being transparent about your financial goals and your spending plan. It is the anthesis of using social media to post photos of luxury spending on a designer purse, Italian suit, red sportscar or selfies from your trip to the Maldives.

It is not being afraid to say no in the public square if an expense does not fit in your budget or does not support your financial goals. Loud budgeting is replacing social pressure or FOMO (fear of missing out) with prioritized spending such as saving to buy a car, fence the backyard, fund a special trip, pay off a debt or increase retirement savings. It is saying out loud, “Thanks for the invitation, but I’m going to pass. I’m paying off a debt right now.”

Loud budgeting is creating boundaries around your spending plan and communicating it to other people who can offer encouragement and accountability and even share budgeting tips. It is making money-conscious decisions about what you can or cannot afford and not being embarrassed or ashamed to announce it.

With the cost of living spiking in recent years, loud budgeting is a refreshing trend. It is a financially healthy alternative to futilely trying to keep up with the Joneses.

Is budgeting actually becoming cool? Maybe. So I say, “Well done!” to the members of the next generation who are making this topic viral. Loud budgeting is breaking down taboos around discussing personal finances and can help reduce impulse spending, reduce financial anxiety and promote attaining enduring life goals.

Finally, many of my peers may not be on social media or feel comfortable publicly sharing their personal financial journey with the world. I get it. Try this instead: shrink the circle of sharing to just family, friends and your financial planner.

It’s a new and different perspective on improving your financial well-being. By the way, my friend’s daughter’s name is Hope. It seems relevant.

This article originally appeared in the Knoxville News Sentinel online on February 23, 2024.