How ‘Friendflation’ Is Forcing Americans to Rethink Costly Friendships

Feeling isolated? It might be due to rising inflation, as revealed by a recent survey.

A survey conducted by BadCredit.org, which aids people in making informed credit decisions, found that 37% of Americans are distancing themselves from friends because the cost of maintaining these relationships has become prohibitive.

Among different age groups, Generation Z (44%) is most likely to prioritize saving money over social engagements, closely followed by millennials (38%), and then Generation X (36%). Baby boomers are the least likely to forsake friendships for financial reasons, with only 23% admitting to doing so, according to the survey results.

For some, the financial strain goes beyond just spending less time with friends. The survey indicated that one in ten respondents have terminated a friendship due to high costs associated with it, and another 21% feel a sense of imbalance or resentment as they perceive they spend more on their friends than what is reciprocated.

Erica Sandberg, a consumer finance expert at BadCredit.org, expressed concern over these findings, stating, “It’s troubling that so many are sacrificing their social connections because of financial pressures. These relationships are crucial.”

The Financial Burden of Friendships

The survey pointed out that millennials typically spend the most on friendships, averaging $482 monthly. Following them, Generation Z spends about $433. On the other hand, Generation X and baby boomers spend considerably less, around $257 and $256 respectively.

Most of the expenditure by millennials goes towards food and drinks, summing up to $275 monthly. Generation Z prefers spending on entertainment, like movies and concerts, with an average spend of $102. Generation Xers and baby boomers tend to spend on dining out with friends, averaging $93 and $84 per month, respectively.

When factoring in special occasions such as birthdays, weddings, or vacations, the annual cost of maintaining friendships can soar to an average of $5,184. Specifically, millennials might spend up to $7,138 annually, while Generation Z could spend around $6,181. Generation X and baby boomers generally spend less, at $3,905 and $3,832 respectively.

Urban residents significantly outspend their suburban or rural counterparts on friendships, with city dwellers averaging $747 monthly compared to $238 for suburbanites and $221 for those in rural areas.

What Else Are People Spending On?

Desire to socialize remains strong, as over three-quarters of the survey participants expressed a wish to meet their friends more frequently. This is noteworthy considering 21% see their friends only once a month.

However, financial constraints are a major hurdle. One Reddit user, Ok-Sky1329, commented earlier this year, “Staying indoors and avoiding outings is the only way I can manage not to spend extra money. It feels like stepping outside automatically incurs a $100 charge.”

According to the survey, 65% of respondents have reduced their social activities to save for significant expenses like housing or debt. This cutback is particularly notable among 74% of Gen Z, 64% of millennials, 67% of Gen X, and 49% of Boomers.

Is Dropping Friendships Over Finances Necessary?

According to Sandberg, financial constraints shouldn’t sever friendships. She suggests, “While going out can be pricey, especially in city areas, there are usually numerous affordable or free activities available. Consider organizing group walks, checking out free museum days, or exploring restaurants with happy hour deals. Instead of declining invitations, propose these cost-effective ideas.”

Yet, Reddit user Ok-Sky1329 shared a more skeptical view, pointing out that even ‘free’ events often come with hidden costs like paid parking. They also noted, “If your social circle mainly enjoys going out for drinks, it might be time to get comfortable with your own company. This could be an opportunity to enjoy some solitude.”