Could You Be a Victim of “Lifestyle Inflation?”

Think back to five or ten years ago, to how your life was then. If you can remember, think about how much you were making at your job then. Also think about what your life looked like, as far as what you had and the things you used to do.

Now take a look at your life now. How much more do you make now than you used to back then? And how much more stuff, expenses and bills you have now, that you didn’t used to have back then.

I wanted you to take a look back at years past, and take a good look at your life now, to help you understand the concept of “lifestyle inflation.”

For most people, the big goal is to do better in the future than they have done in the past. And that includes living a better life now than they did years ago.

Well, while we all want a better life for our families, which usually includes having more and experiencing more, the fact that you earn much more than you did ten years ago, but still don’t seem to have the financial health you’re looking for, is a sign that your household has experienced lifestyle inflation.

Getting caught in lifestyle inflation means it can always be difficult to save. Because there is always something new you want, or another part of life to experience. And no matter how much more you earn, lifestyle inflation can eat up that additional income to the point where you experience money problems month after month, year after year.

Lifestyle inflation can be damaging to your life and finances over time… limiting how much you can save and your potential to amass wealth.

One big factor that brings lifestyle inflation into the lives of many families is the ever-present need to “keep up with the Jones'” next door. Your neighbor gets a 75 inch TV, so you have to get one. A neighbor down the street just bought a convertible sports car, so now you need a sports car too. A co-worker just got a massive new home, so now you feel the need to live in a palace too.

My advice to you is to break the pattern that makes you want to keep up with your neighbors, your co-workers, and every advancement that comes along, both large and small.

When you realize that it’s all about life and your family and friends, and not all about getting more and more, and bigger and bigger stuff, you can start to see the things in life that are important. Which most people miss out on, because they are too busy keeping up with the Jones’… then wonder why they don’t have any money, even though they earn way more than they did ten years ago.

Want to know a way you can easily break-free from the limitations of lifestyle inflation gone wild? See what I have for you here.

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Gift of Giving = Financially Fit
Financial Literacy Month Action Steps (Part 2)
Is Working from Home Right for You?

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