I’m sure you have heard of the lifestyle creep

But let me tell you about a REAL LIFE example

That many of you have probably heard

(thread)

A few months ago

A coworker asked if I could help her build a budget

She wanted to get better with her finances and start saving more

So I sat down with her to go over her expenses and spending

It was not pretty....

She was spending nearly all of her income

And what she had left over

She said she would save!

However

Most of the time

She had nothing left over to save

*Side note*

I truly do not care how you decide to spend your money

It’s YOUR money

But

If you ask for my advice

I am going to give it to you straight

Okay... back to the thread

Fast forward to a few days ago

I was talking to my coworker again

She mentioned how she was looking to get into management

That is GREAT!

However

What she said after that

Is the DEFINITION of lifestyle creep

She said

“Once I get into management, I am going to buy myself a new car”

Oh no...

I know 3 things about this situation

1. Her current car is perfectly fine, so she doesn’t NEED the car

2. The management position doesn’t pay that much more

3. It will be financed

Again

I truly do not mind how she or anyone else decides to spend their money

But

Lifestyle creep, like this situation...

Is robbing you of financial security

And many people don’t recognize it

How do you beat lifestyle creep?

1. Don’t increase your spending as your income increases

OR

2. Only increase your spending a fraction (20-30%) of the income increase

Then

Invest the increase

That’s all you have to do!!

I hope this situation was a great LESSON for you to understand how

Lifestyle creep can secretly rob you financially

If you think this thread could benefit others, feel free to share!

Thanks again for reading this

@DecadeInvestor