What is lifestyle inflation?
This is when one’s living expenses change with a change in income or revenue, and in this case, it is an increase in income, to be precise
Is lifestyle inflation an evil?
How to avoid lifestyle inflation?
In most cases, it is viewed as such, and even some people will say it is the reason most people live paycheck to paycheck; some will even push it and say it is the reason some live on the debt revolving door, and in as much the basis of these arguments hold water let me give you a different view as I always do, lets challenge this narrative for a minute.
Let’s start with an illustration for this, shall we?
I earn a monthly salary of 50k, and I try my best to live a life that my tomorrow me will be proud of, so I practice the 50/30/20 budgeting rule 50% takes care of your needs, 30% wants, and 20% savings & debt, you can read more about budgeting https://mbuguaandassociates.com/personal-budget-planning-phase/ its a series get all three doses, if this argument is to hold water as well then if and when the revenue/income changes it means that the ratios will also change, and this then means lifestyle inflation is the monster that is making you live paycheck to paycheck, or on that debt revolving door, the reason why that is your reality is simply because of your financial indiscipline.
In my opinion, lifestyle inflation is necessary for each of us because without it, what would motivate us to strive for improvement? We would be content and not desire more or better, and that is why the question should not be how to avoid lifestyle inflation; instead, it should be how to leverage lifestyle inflation to grow.
To leverage lifestyle inflation for growth, all you need are two simple ingredients: financial discipline and a budget. Or better put, the discipline to honour your goals that are well guided by your budget.
So the next time someone quotes lifestyle inflation as the reason they are stuck, feel free to use this article to correct them and tell them I said it’s their poor habits that have them locked in the debt revolving door and not any type of inflation.
And let me close by addressing the issue that the cost of living keeps growing, but the same is not the case for income. Now that is true, and because from time in memorial the resources have always been limited to demand, it is up to you to either choose other ways to cover the growing demand without getting into unnecessary debt or downgrade your lifestyle, or keep viewing the unfairness of life.
Checks & Balances
Today I wrap it up with a quote I love and that I have found myself relating too lately, you are at liberty to make a decision or make a choice, but not at liberty from the consequences of the choice, decision or lack of either, so ask yourself how will I view lifestyle inflation, because that’s your choice after that the consequences are just the results.