Fear of Finding Out (FOFO) your bank balance affects over a third of millennials. Here, Moya Lothian-McLean discovers how to overcome hers…
How far would you go to avoid looking at your bank balance? Friends, when it comes to evasive financial manoeuvres, I possess the skills of a fully-fledged RAF pilot.
At their peak, my efforts to duck confronting just how little money I possessed (or thought I possessed; who knows when you’ve not looked at your account for three weeks?) saw me sending money via PayPal to my mates, only to ask them to immediately return the sum.
Why? So I could withdraw it to my Monzo card straight from the third-party platform, without ever having to log onto my banking app and see the sorry figure I fretted would greet me.
“This feels like money laundering,” a friend remarked.
Somehow I didn’t think my pitifully circuitous scheme, devised solely to dodge checking my bank balance, would bring me any respect from hardened Mafiosos. Besides, if anyone was being defrauded here, it was me.
As it turns out, I was suffering from ‘FOFO’, or ‘Fear of Finding Out’, as new research from Barclays has dubbed it. FOFO is what drives you to stab frantically at the ‘No’ option when the ATM innocently asks if you want to check your balance while withdrawing cash. FOFO is why any official-looking letters from your bank go straight into your nearest recycling bin. FOFO is the reason you haven’t yet sent your share of the brunch bill to your friend – because doing so means having to address the reality of your finances.
A third of millennials are consistently frightened of checking what’s going on with their bank balance, according to the report findings. Despite our best intentions and attempts, there’s still a huge portion of us who feel utterly at sea when it comes to financial security. Seventy per cent of us set a monthly budget, but a quarter admit we’re panicked by how easily we lose track of our spending. And half of those questioned said they’d lost sleep over the state of their finances.
I am firmly of their number. Having been in debt for almost all of my adult life, looking at my bank account has never been a pleasant experience. At best (AKA payday) I’m greeted with a figure I know will quickly be depleted by direct debits, bills and general bad money management. At worst… well, I wouldn’t know. As soon as my finances begin to dip towards the danger zone, my immediate reaction is to bury my head in the sand. It’s like the sun; if I don’t look directly at it, it can’t blind me.
It can still burn me though; ‘out of sight, out of mind’ doesn’t make for a satisfactory solution when it comes to my bank balance. The more unaware I am of how much money I have, the more stressed I become, imagining that I’m constantly on the brink of going too far into the red to return. But even that doesn’t stop me from impulsive spending. I often ‘save’ money (read: skip a few treats I wasn’t even supposed to be having) and then reward myself by buying clothes or going for drinks. And then, surprise! I receive a text from the bank warning me how dire my situation is, and my stress levels skyrocket further.
However, I’m far from the only one dodging balance updates.
“I have a horrible attitude of ‘If you don’t see it, it isn’t happening,” 26-year-old Becca tells stylist.co.uk.
“[I check my balance] once every month to make sure I’ve been paid and nothing’s going disastrously wrong. It stresses me out seeing how quickly money can disappear from my account, even though all I think I’m buying is the odd lunch or a round of drinks. Once I didn’t check an old current account, and managed to rack up almost £100 in charges for going £2 into an overdraft. It’s very telling that that was able to happen.”
“I’ll only check my balance if I absolutely have to,” agrees fellow millennial, Milly. “It gives me such anxiety. In the past, if I’ve needed to make a transfer, I’ve logged in or called the bank and then not looked at the part of the screen where it showed my balance, or held the phone away from my ear as they read it out. I know how stupid it sounds.”
FOFO, it’s clear, is driven by feeling that we have lost control over our finances. And Dr Pete Brooks, Head of Behaviour Finance at Barclays, informs stylist.co.uk this shame is one of the reasons millennials are hit so hard by FOFO.
“[Millennials] have reached that stage of moving away from home, getting a job, becoming independent and suddenly realising that your money management skills are not necessarily the best,” he explains.
“You [can] feel less adult because of it, which then triggers shame and guilt - all the negative emotions that we, as individuals, naturally want to avoid. So rather than taking control of the situation and facing it head on, many of us do what’s most comfortable – which is not look.”
It makes sense; despite being an independent adult, when it comes to banking I still feel almost as clueless as I did when I was 13, flipping through a money management guide my mother had bought me, having already spotted my ability to fritter away pocket money at a worrying rate. And that cluelessness is uncomfortable. Ignorance is bliss – until ignorance leads you into a £1,500 overdraft hole and no way of getting out.
But how can we overcome such a primitive psychological fear as ostrich syndrome [ignoring problems instead of confronting them]? Dr Brooks says the key lies in creating a present situation that forces your future self to confront the fear – a trick known in economics as a commitment device.
“People recognise that they’re avoiding a problem, but that doesn’t necessarily make them want to change their behaviour,” Brooks says. “But once you get someone to have that knowledge, [they can] display a little more commitment. There’s the urban myth of one person who decided to control their impulse spending by freezing their credit card. Then they’d have come home from the shops and wait for their credit card to thaw before they could go back and buy the item they’d just seen. It gave them time to reflect on whether they really needed it.”
Your commitment device doesn’t need to be that drastic, though; it’s just a case of working out exactly what you can do to remove the temptation to spend. I spent an hour with Tim, a Barclays financial advisor, who’s part of a Money Mentoring scheme the bank is piloting. The programme offers free sessions to millennials (whatever institution you bank with) to help them make sense of their financial queries, whether that’s “How should I save for a future home?” or – if you’re me – “How on earth do I get out of my overdraft?”
Brainstorming helped me reach the lightbulb realisation that it’s my weekend spending and online PayPal purchases that cause me grief, so I’m trialling two solutions: cash only weekends and removing my current account from my PayPal. The flesh is willing but the willpower itself is weak, so instead of trying and failing to rely on finite self-control, cut off the money. Be both the sugar baby and parent in one.
And if you’re worried about relying on yourself, bring (willing) friends into the equation. The power of peers is unparalleled, Dr Brooks says.
“Social contracts [agreements you make with your friends] tend to be more enforceable because you feel like you’re letting somebody else down if you don’t follow through with it,” he says. “It’s a really positive way of thinking about the problem – it just depends on who the individual is and whether you trust them.”
But the number one thing you should be doing to combat FOFO today – apart from actually checking your bank balance – is Cut, Change, Keep. Download a spending tracking app like Monzo or Mint and look at your daily outgoings. Then make a list of what spending you can cut, what you can change, and what you’re going to keep.
“Cut, Change, Keep gives you a sense of taking control of the situation,” says Brooks. “Once you’ve got a better handle on the negative sides of spending, you’re able to reinforce even more positive behaviours like saving on payday.”
Voila – I’ll show you FOFO in a handful of dust.