Avoiding Recession-Era Faux Pas

by Lauren Sherman

What not to talk about during the downturn

John Scally isn't a cheapskate, but he felt like one last week.

While visiting an old friend in Portland, Ore., the 39-year-old communications consultant rejected the idea of dining at Ruth's Chris Steakhouse, the restaurant chain where a T-Bone will set you back $41. Instead, Scally suggested a less expensive Italian joint. Afterward, there was a feeling of awkwardness between the two men.

"With times being the way they are and no job safe, I didn't feel right dropping over $100 on dinner," says Scally. His reasoning backfired. "I felt like my friend thought I was being cheap or that I didn't want to have a good time."

Hoang-Uyen N., a 28-year-old advertising executive in Minneapolis, says she's often made to feel uncomfortable by a longtime acquaintance who constantly talks about how much money she makes. "She's always bragging about her latest work bonus, or how she spends without limits," says Hoang-Uyen. "I always wonder, 'Does she even know that we're in a recession?'"

In times of financial trial, socializing gets tricky. Whether you're on Scally's end, trying to save while not looking stingy, or you are one of the fortunate who still has the freedom to spend, it's tough to determine what's appropriate to discuss openly. Indeed, discretionary spending might be down, but it's not dead. There are people out there spending money on everything from beauty creams to eight-course tasting menus. For example, 12.1 million cosmetic plastic surgery procedures were performed in 2008, up 3% from 2007, according to the Arlington Heights, Ill.-based American Society of Plastic Surgeons.

But how do you know what's OK to talk about and what's not?

"Etiquette is really about making people feel comfortable, which means we all have to be a bit more sensitive when talking about money and spending right now," says Cynthia Lett, executive director of the International Society of Protocol and Etiquette Professionals in Silver Spring, Md. "If you're flush enough to go get a facial once a month, that's not something you should discuss, unless you're absolutely positive that the other person is in the same boat."

It's fair to say that recession-era cocktail party conversation should be conducted differently than the banter of the boom years. Casually mentioning that you and your wife recently closed on a second summer home, that you've joined a fractional jet ownership club or that you're planning a private $50,000 African safari vacation this autumn should be avoided.

Unfortunately, for some, that leaves little to say. "Before, everyone was constantly discussing upcoming trips, or how much they were spending on home renovations," says Peter Post, a director at the Emily Post Institute in Burlington, Vt., and author of five books on etiquette.

If you find yourself at a loss for words, Post advises, focus on those around you. Ask them how they're doing, what they've been up to, instead of injecting an anecdote from your latest shopping spree into the conversation.

Regardless of your situation, try not to feel bad about your circumstances. Scally, in eschewing the pricey steakhouse and opting for affordable Italian, did what was right for him, and that's more than acceptable, says Post. "We all have to make choices, and we should try to be a little more understanding in times like these."

Purchases You Shouldn't Talk About Right Now

1. Summer Rentals

Demand is down for summer rentals, which means many properties will be discounted. For example, in parts of Cape Cod, four-bedroom homes that last year went for $15,000 a week can be had for 15% to 20% less. If you plan on taking advantage of the reduced prices, don't make a big deal out of it. Instead, invite your less-fortunate friends down for a weekend of relaxation and inexpensive recreation.

2. Vacations

You're probably still planning at least one vacation for 2009. In fact, 82% of Americans with annual household incomes over $75,000 intend to travel during the first half of 2009, according to a December 2008 survey conducted by marketing firm Y Partnership. However, it's important to be sensitive around those who might be cutting back or skipping a holiday altogether. Only discuss the basic plans for your trip.

3. Spa Treatments

Manicures, pedicures and facials are still popular, according to the International Spa Association, which says that the number of spas operating in the U.S. grew 24%, from 14,600 in 2007 to 18,100 in 2008. However, many consumers have scaled back, visiting the aesthetician every three months instead of once a month. It's best to keep your indulgences to yourself.

4. Jewelry

While some companies in the jewelry industry are faltering--Tiffany, for example, saw a 20% decrease in sales in the last quarter of 2008--the very high end continues to succeed. If a friend inquires about your latest purchase, play down its lavishness.

5. Cars

U.S. sales for Rolls Royce increased by 26.6% over 2008, which means that more of us than ever are investing in these six-figure vehicles. But bragging about your new ride is no longer kosher, because it's likely that many of your friends have traded down in terms of luxury.


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