Time to read : 4 Minutes
You’ve probably felt it. A friend buys a property. A colleague brags about shares that “doubled overnight.” Your social feed is filled with people flexing crypto wins or side hustles.
Suddenly, you’re questioning your own financial choices and wondering have you missed the boat!
This is ‘financial FOMO’. It’s the fear of missing out on wealth, driven by this perception that others seem to be getting ahead… or that you are getting left behind. And while it’s natural to compare, copying other people’s money moves can be one of the fastest ways to derail your own financial goals.
What is financial FOMO?
At its core, financial FOMO is the anxiety that you’ve missed out on something and should be doing better. It’s that uneasy feeling when a friend scores a property deal, or when you see a peer talking up about their investment wins online.
Psychologists call this social proof. It’s a phenomenon where we copy the actions of others when deciding how to behave, especially in uncertain situations. The term was coined by Robert Cialdini in his book Influence: Science and Practice.
When it comes to money, social proof feels safe: if everyone else is doing it, surely it must be the right move.
And it’s widespread. A survey by Empower found more than half of Americans (51%) have made a financial decision after seeing someone else’s lifestyle online. This figure jumps to 70% for Gen Z.
Closer to home, FOMO could be contributing to Australia’s property market as prices hit highs in July 2025. Strong annual gains of 4.9% and big jumps in cities like Adelaide (up 9.4%) and Brisbane (up 9.0%) could be fuelling the belief that "waiting means missing out."
FOMO may be pushing buyers to stretch their finances or make hasty decisions. And three out of four Aussies believe property prices will keep rising over the next year.
Why copying financial decisions of others can backfire
The main issue of copying is that financial decisions are never one-size-fits-all. What works for one person might be a disaster for another. Here’s why:
Different goals: your friend might be chasing short-term gains, while you need long-term stability.
Different risk tolerances: some people can have the appetite and tolerance for big swings in value. Others may lose sleep and prefer less risk.
Different timelines: buying a property at 25 with no dependents looks very different to buying one at 40 with a family.
Incomplete stories: people rarely share the whole picture – the debt, the help from the Bank of Mum and Dad (BoMaD), or the sheer luck involved.
A personal lesson learnt the hard way
I’ve been there myself. Years ago, I watched a friend jump into an investment and do incredibly well. A few months later I followed their lead, only to realise I didn’t really understand what I was doing, and the conditions that worked for them weren’t the same for me.
I lost a tonne of money.
That was a hard but important lesson...
Sometimes people really do get lucky.
Sometimes they’ve got extra advantages they don’t talk about.
And sometimes, by the time you hear about it, the window of opportunity has already closed.
It taught me one of the most important rules of investing going forward which is: never put your money into something you don’t understand.
Speculating vs investing
There’s also a bigger distinction at play: the difference between speculating and investing.
Speculating is chasing a win in assets you hope will go up in value. Examples are crypto, meme stocks, or “can’t-miss” hot tips. It’s gambling dressed up as strategy.
Investing is building consistent returns, understanding the risks, and aligning them with your long-term goals.
Financial FOMO thrives on speculation. This is the temptation to copy someone else’s lucky break. Real wealth comes from investing with clarity, patience, and discipline.
Legendary investor Warren Buffett puts it simply: “Never invest in a business you cannot understand.” It’s a reminder that the smartest investors in the world avoid speculation and stay firmly anchored in what they can clearly see, measure, and value.
How to resist financial FOMO
Instead of copying others, run every decisions through a simple filter:
Clarify your goals: are you aiming for security, growth, flexibility, or freedom?
Check your capacity: can you afford the risk without threatening your lifestyle?
Look for fit, not flash: just because a decision looks good for someone else doesn’t mean it fits your life stage.
Do your own homework: read widely, run the numbers, and understand the risks.
Talk it out: a neutral friend or adviser can help spot blind spots before you leap.
Bottom Line
Financial FOMO is powerful, but it can be dangerous.
Copying someone else’s move might feel like a shortcut, but it can lead to stress, mismatched goals, or outright losses.
The real key is staying anchored to your own goals, risk comfort levels, and understanding.
Because the quickest way to lose money is to speculate on something you don’t understand, and the surest way to build wealth is through consistent, deliberate investing.
So next time you feel the itch to copy a friend’s “big win,” ask yourself: am I really investing… or just speculating?
Remember… in the long run FOMO doesn’t build wealth. Understanding does.
Go deeper:
What’s financial literacy and why is it important for the next gen?
Here's how to work out finances with a live-in partner with no stress
Want to know how to choose a financial adviser you can trust?
Financial disclaimer
The information contained on this web page is of general nature only and has been prepared without taking into consideration your objectives, needs and financial situation. You should check with a financial professional before making any decisions. Any opinions expressed within an article are those of the author and do not specifically reflect the views of Compare Club Australia Pty Ltd.
