Peer influence in student spending

University life in Bangladesh is a major transition. For many students, this is the first time they manage or earn their own money. However, instead of making choices based on their budget, some develop a tendency to spend in ways increasingly driven by what their friends are doing.

Research shows that students often copy the habits of their peers to maintain social connections and "fit in". In major cities like Dhaka, spending behaviour has shifted towards identity rather than actual need. Whether it is eating at expensive cafés, following fashion trends, or attending group outings, these choices are often social expectations rather than personal ones.

Social media and influencer culture have made this pressure even stronger. The "fear of missing out" (FOMO) often leads to impulse buying and social comparison. Unfortunately, many students, especially in their first year, lack the financial knowledge to manage this pressure. This results in lower savings and a reliance on family support or debt to maintain a lifestyle they cannot truly afford.

Just as Bangladesh needs a "smooth transition" for its national economy, students need a plan for their personal finances. University should be a "grace period" to learn how to save and spend wisely. To avoid financial trouble after graduation, students must prioritise being "prepared" over simply following social trends. While friendships are a vital part of university life, following the crowd can become a financial trap. By building financial awareness early, Bangladeshi students can ensure their future is defined by their own goals, not by the spending habits of those around them.

MD Ifaz Ahmed Khan

Department of Accounting and Finance

North South University