Insecurity

I think one of the main reasons why people tend to lie about their lives is insecurity. Especially in the case of old friends who haven't seen each other in a long time. Sometimes the image of their old friends that's embedded in their minds was from years ago and then when they finally meet up, they're surprised at how successful or 'changed' their old friends are and when they try to look at themselves and see what they've become, sadly they realize that they're not quite as successful as their friends and they become insecure so they make up stories to somehow 'level up' to their friends.