Gen Z may not be spending much on dating, but when it comes to hanging out with friends, the bill adds up fast. A new study by Ally Bank found that many young adults are overspending to maintain social connections, even at the expense of their financial goals.
FOMO drives social spending
The survey of 1,000 Gen Z and millennial respondents saw 42% admit to overspending on activities with friends a few months out of the year, while 18% said they overspend every month. Jack Howard, head of money wellness at Ally, says the “fear of missing out” contributes to this.
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“FOMO is real and can lead to overspending that harms our financial well-being,” Howard said. “Be open with your friends if you can’t swing that brunch or birthday trip. You might be surprised to learn they’re in the same boat. Discussing money openly with friends can help dismantle the shame around financial struggles and is a great way to explore affordable ways to spend time together. Plus, the ultimate BFF is someone who respects your relationship with money.”
The friendship tab adds up
On average, people spend $250 a month on activities with friends. Over a six-month period, men reported spending $1,775, compared to $1,250 for women.
The study also found that 44% of respondents have skipped major social events because of the price tag. Nearly a quarter of respondents said social spending makes it difficult to build up their savings.
When money affects friendships
The research also revealed that 20% of participants said a financial or lifestyle difference has contributed to the end of a friendship.
One example that’s gained attention on social media is the so-called “Miami Girls’ Trip Curse” — a viral idea that many friend groups don’t survive a group vacation to Miami, Florida. While the reasons vary, cost is often a major factor, from disagreements over splitting bills to pressure to join expensive outings.
It’s not just Miami. Bachelorette weekends have become another high-cost friendship event. Some women tell Katie Couric Media they spend $1,500 to $2,500 per weekend.
“I’ve spent a minimum of $20,000 on bachelorette parties so far in my life,” one woman said. “That’s not even considering the cost of their weddings.”
When you get to the actual wedding, David’s Bridal estimates the average wedding gift cost in 2025 is between $100 and $150 per guest.
“I absolutely believe you can have both — meaningful friendships and healthy finances — it just takes a little planning,” Lindsay Sacknoff, head of consumer banking at Ally, said.
Loneliness in the US
A 2024 Gallup poll found that daily loneliness affects 20% of adults in the United States — the highest level since the height of the COVID-19 pandemic.
While the pandemic contributed to what the World Health Organization now considers a global concern, increased screen-based interactions and weakened communal ties could also be a reason.
The United States Surgeon General’s 2024 advisory on loneliness highlighted how social isolation is associated with increased risks of heart disease, stroke and other conditions like depression and dementia.
WHO estimated that more than 871,000 deaths annually are linked to loneliness.
Balancing fun and financial goals
The latest findings highlight the challenge many young adults face in balancing a social life with bigger financial milestones such as buying a home. While experts say it’s not impossible to do both, it requires honest conversations about money and intentional planning to keep relationships and bank accounts intact.
