Cristal, Maybach, Diamonds on Your Timepiece: How Does Conspicuous Consumption Affect You?

By Michael Gutter, PhD, Department of Family, Youth, and Community Sciences, University of Florida, and Brittany Stahl, MS student, Department of Family, Youth, and Community Sciences, University of Florida,
Reviewed by Martie Gillen, PhD, Department of Family, Youth, and Community Sciences, University of Florida

Lorde’s song Royals (quoted above) was a huge hit in 2013. This song actually questioned the importance of the luxury goods that celebrities and musicians often tend to promote and flaunt. However, there’s no denying that many of us are still susceptible to the urge to buy and own these items, even when we can’t afford them. What’s behind these desires?

What is conspicuous consumption?

This behavior can, in part, be explained by the concept of conspicuous consumption. Conspicuous consumption occurs when goods and services are purchased with the intention of enhancing our image by communicating our status to others. Though the average person can never hope to purchase a jet plane or a “tiger on a gold leash,” the concept still applies. For instance, have you ever longed for or bought an expensive, top-of-the-line television or a designer handbag or watch? Did this impulse come from hoping to impress others?

Who is most affected?

Lower-income households are often more affected by the issue of conspicuous consumption than higher-income households. Since they also have less savings, this can be a problem. The people we associate with and our gender can also affect how likely we are to fall prey to conspicuous consumption.

What do purchases such as these mean to your savings…and your debt levels?

The simple answer is that getting involved in conspicuous consumption can negatively affect your savings. If you are emulating someone with more money than you, you cannot possibly afford to purchase all the same goods that he or she can. When you spend your available funds on luxury goods, your savings are not going to increase, and you may even find yourself going into debt.

What can you do?

Many options exist. Consider why you want the item you are coveting. Does the item really have personal value for you, or is it a status symbol? If it is an item that you truly wish to own, save for it, and purchase the item when you can honestly afford it.

To afford items like these in the future, try setting short-term and long-term SMART goals for yourself. SMART goals are Specific, Measurable, Attainable, Relevant, and Time-bound.

And remember, too, that your mom was right (as she often is): the people who matter don’t judge you by the clothes you wear or the “stuff” you have. What’s important about you is who you are and what you accomplish.

(Photo credit: Rolex GMT by Jimmy Baikovicius. CC BY 2.0.)

Further Reading:

Cutting Costs to Live Within Your Income–from UF-IFAS EDIS

Building a Spending Plan series–from UF-IFAS EDIS

Check out this video from UF-IFAS Extension. By following these simple steps, you too can slam dunk your savings!


Ordabeayeva, N., & Chandon, P. (2011). Getting ahead of the Joneses: When equality increases conspicuous consumption among bottom-tier consumers. Journal of Consumer Research, 38(1), 27-41. DOI: 10.1086/658165

O’Cass, A., & McEwen, H. (2006). Exploring consumer status and conspicuous consumption. Journal of Consumer Behavior, 4(1), 25-39.


Posted: May 20, 2014

Category: Money Matters, Work & Life
Tags: Family Resource Management, Personal And Family Finances

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