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Normal financial advice tells us that skipping the bar tab saves money, but it may be costing us in mental health over the long run.  A new survey from the American Psychiatric Association found that 54% of adults cope with loneliness by watching TV, movies, or online videos. Another 54% listen to music. Thirty-eight percent turn to social media. All of these come under a thread of emotional regulation, ways of numbing discomfort without confronting it.¹ While Americans continue to retreat from social life, they're also paying for the privilege of doing so. Many households are pushing past $100 a month in digital media subscriptions. Meanwhile, the number of adults who say they drink alcohol has fallen to 54%, the lowest rate in nearly 90 years according to a 2025 Gallup poll.² Gen Z drinks roughly 20% less than millennials did at the same age.³ Honestly, on paper, this looks like progress. Less money on alcohol and nights out = more money in the bank. But the trend is signaling something far more worrisome: the migration from social spending to isolation spending costs an enormous amount in mental health. Two Budget Lines Moving in Opposite Directions The decline in alcohol spending among younger generations is certainly real, but the explanations go far deeper than a sudden burst of Gen Z health-consciousness. The real culprit is a dramatic collapse in shared time. Data from the U.S. Surgeon General's advisory shows that the average American spent 30 hours per month with friends in 2003. By 2020, that number had fallen to 10 hours, with the sharpest drop among people aged 15 to 24.⁴ Less time with friends means less spending on the social activities that accompany them -- bars, restaurants, concerts, events. Researchers at Goliath Consulting note that Gen Z isn't inherently averse to drinking; they're spending the same proportion of after-tax income on alcohol as millennials did at the same age. They simply have fewer social occasions that call for it.⁵ So where is the money going? Into subscriptions. Into streaming platforms. Into the exact services designed to fill the void once occupied by spending time with other people. The result is a budget that has simply rebalanced itself according to these new generational rules. The line labeled "going out" has shrunk while the line labeled "me time" has grown. The problem is when too much "me time" leads to a deterioration in mental health. The Mental Health Part of the Equation Back in the day, personal finance didn't extend beyond dollars and cents. But today, things have changed; we have to evaluate saving and spending from not only a monetary perspective, but also from a happiness and wellness perspective. Loneliness has a real, measurable economic cost that accrues to you, not just to society. A 2025 systematic review published in the journal Pharmacoeconomics found that the economic costs of loneliness and social isolation range from $2 billion to $25.2 billion per year, driven primarily by healthcare utilization and lost productivity.⁶ A separate analysis from Deloitte and the Meharry School of Global Health found that mental health conditions generated $477.5 billion in excess costs in 2024 alone.⁷ I understand that these are macro figures, but they compound from individual decisions. Lonely people are more likely to seek medical attention, more likely to experience depression and anxiety, more likely to miss work. Every $15 streaming subscription that replaces a $30 dinner with a friend isn't necessarily a $15 saving. There's a possibility that it accumulates before resulting in a much larger bill down the line. Even more interesting is the return on investment for loneliness reduction programs. Social return on investment studies consistently find that programs designed to reduce loneliness return between $2.28 and $13.72 for every dollar spent, primarily through reduced healthcare costs.⁸ Spending money on your social life is both good for personal happiness and for return-on-investment. The Substitution Problem As socializing has migrated online, the spending has migrated too. Streaming platforms, gaming subscriptions, and social media (free to use, expensive in other ways) have absorbed the hours and, increasingly, the dollars that used to go to physical presence with other people. Of course, it's not all bad -- there are many genuine friendships formed online. However, the research on in-person connection versus mediated connection consistently finds that physical presence has mental health effects that screens don't replicate. And, if you really study the numbers, the screens really aren't that much cheaper. A Prime subscription costs $18/month. A night out can run $80–$150. Staying home and watching a movie on Amazon wins, right? But that comparison only works if you're substituting one for the other cleanly, which we all know is not how it works. These platforms you're spending time on are specifically engineered to extract money from you in ways that are much harder to track than a restaurant tab. As I've covered before (here and here), these platforms don't just charge a subscription fee, they generate spending in various other ways. Social media and online streaming fill the hours once spent with friends, simulating the feeling of social connection through notifications, reactions, and the sense that someone is always there. Meanwhile, our algorithms are serving us targeted ads, surfacing influencer recommendations that don't look like ads, and routing us toward frictionless in-app checkout. The lonelier we are, the more time we spend scrolling. The more time we spend scrolling, the more we buy. It's a vicious business model that runs on social disconnection. You see, we have a problem: the money saved on avoiding the extra bar tabs isn't being redirected into other forms of genuine social investment. It's being absorbed, often invisibly, by the very platforms filling the void. How to Budget for Social Connection Deliberately Here's my suggestion: treat social spending as a wellness budget line (similar to a gym membership), not a discretionary one. Here's what that looks like in practice. 1. Audit the substitution trade-off. List what you're currently paying for isolation (streaming services, gaming, delivery apps for solo meals) and what you're spending on genuine social connection. The average American household now spends $52/month on streaming alone, up 22% from the prior year.⁹ If you're spending substantially more per month on subscriptions than on social activities, it could be time for a change. 2. Set a Social Connection Floor. Just as you'd set a minimum contribution to savings, set a minimum for social spending. No, it doesn't have to be a bar or pub, just anything that involves physical presence with people you care about. Maybe a routine trivia night, or a hike with friends, or a weekend trip. 3. Watch the streaming creep. Each new platform added incrementally costs less than a night out (exactly why it's easy to say yes to) and provides more options for spending your night in isolation. 4. Treat loneliness prevention like health & wellness. We all budget for gym memberships without needing to justify the ROI in detail. Social connection deserves the same treatment. The surgeon general of the United States declared loneliness a public health epidemic.¹⁰ Your budget likely isn't reflecting that. Conclusion Standard personal finance advice treats social spending as a luxury -- the first category to be slashed when times get tight. But looking at the data, cutting out human connection to save a buck is a textbook example of being penny-wise and pound-foolish. The next time you review your monthly budget, look past the dollar signs. True financial health is just as much about maximizing your well-being as it is minimizing expenses. Spending less on alcohol is a great health choice, but spending less on people is a bankrupt strategy. If we want to solve the loneliness epidemic, we have to stop funding our own isolation and start investing in each other again. More Reading: Why the Best Way to Spend Money on Yourself is to Spend It on Someone Else Buying Back Time: The High-ROI Purchase We Don’t Usually Make Why Travel and Experiences are a Triple-Threat Investment References ¹ American Psychiatric Association, 2026 Annual Mental Health Poll, May 2026. psychiatry.org/news-room/news-releases/2026-annual-mental-health-poll ² Gallup, U.S. Drinking Rate at New Low as Alcohol Concerns Surge, August 2025. news.gallup.com/poll/693362/drinking-rate-new-low-alcohol-concerns-surge.aspx ³ International Alliance for Responsible Drinking / Fortune, Gen Z is drinking 20% less than Millennials, December 2025. fortune.com/2025/12/13/gen-z-drinking-20-percent-less-than-millennials-alcohol-productivity/ ⁴ U.S. Surgeon General, Our Epidemic of Loneliness and Isolation, 2023. hhs.gov/surgeongeneral/reports-and-publications/connection/index.html ⁵ Goliath Consulting Group, The Sober Shift: Why Gen Z is Redefining Bars and How to Respond, August 2025. goliathconsulting.com/the-sober-shift-why-gen-z-is-redefining-bars-and-how-to-respond ⁶ Engel L, et al., "An Updated Systematic Literature Review of the Economic Costs of Loneliness and Social Isolation and the Cost Effectiveness of Interventions," PharmacoEconomics, September 2025. pubmed.ncbi.nlm.nih.gov/40524124/ ⁷ Deloitte and Meharry School of Global Health, Mental Health Inequities Cost the US More Than $477 Billion, May 2024. meharryglobal.org/mental-health-inequities-cost-the-us-more-than-477-billion ⁸ Engel L, et al., PharmacoEconomics, September 2025. (See footnote 6.) ⁹ Reviews.org, The State of Consumer Media Spending Report, November 2025. einpresswire.com/article/866688605/report-streaming-price-hikes-push-annual-u-s-media-spending-to-3-350 ¹⁰ U.S. Surgeon General, Our Epidemic of Loneliness and Isolation, 2023.
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