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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)
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....
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
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
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
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
“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
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!!
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
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
