The phrase ‘keeping up with the Joneses’ is a popular one. The phrase most likely came from the lifestyle of New York socialite Elizabeth Schermerhorn Jones who was a vivid part of the New York scene during the 1800s (Jones’s crumbling mansion just sold for $120,000, by the way). The home was so lavish that neighbors tried to build bigger homes just to ‘keep up.’
Many of those homes didn’t survive the Great Depression - likely because repairing these homes was costly and most of those people lived far beyond their means! It’s an interesting story. It’s also one that we can learn a lot from.
Why We Do It
Psychologists and even financial experts refer to the need to ‘keep up’ as ‘conspicuous consumption’. The term was coined in the 1800s by a Norwegian-American economist Thorstein Veblen. Veblen coined the term after observing the newly rich - and the lengths they’d go to in order to appear rich (even if it meant that they had no money saved and lived beyond their means).
Living The Lux Life Today
The 1800s have come and gone, but many of us still try to live up to a wealthy image. An image that is mostly created and pushed by marketers (makes sense, right? Marketers want us to buy things, so they create a lifestyle that looks envious). Sure, there are some people in the world living lavishly with bank accounts stuffed to the brim with dollars -- but, in fact, most wealthy people simply do not spend their money like water.
Need proof? Here’s an interesting article from The Atlantic about the money-saving habits of the super rich. So if the rich are saving and not spending, who are we keeping up with, exactly? Isn’t that an interesting question? It’s also one that doesn’t have an immediate answer.
It seems that we are keeping up with an image. One pushed and portrayed by the media. Or we’re keeping up with a socialite family from the 1800s that no longer exists. Or maybe we just want to impress the neighbors? Everyone probably has a different answer, but living beyond your means for the sake of appearances will hurt you in the end.
Just ask the millions of people with massive credit card debt. Credit card debt is, by the way, at an all-time high. Or you could ask the millions more with student loan debt. Or maybe we can consider all the millions with both credit card and student loan debt - that are still being approved for massive home loans. It just doesn’t add up. Something’s got to give.