Have you started making more money? Have you been debating upgrading your lifestyle?
Today we’re going to look at lifestyle inflation and the idea of upgrading your lifestyle once your income increases. There are two polarizing views on this idea. One strategy is to use your pay increase to push up your savings. This means that you pretend you never even received an increase in money. The other view (uncommon on personal finance blogs) is to upgrade your quality of life when your income goes up.
Is lifestyle inflation okay?
I’m going to say that it is. Most personal finance pundits suggest that you save and deprive yourself. I believe in the opposite. When you make more money, the odds are that you worked for it. You likely earned your raise or salary increase or bonus. Why not spend it on yourself? Why not reward yourself? I say that you go ahead and upgrade your life.
There are a few caveats when it comes to lifestyle inflation. What are they?
I suggest that you start off small. Instead of buying a new car or moving into a bigger place, why not start with food? You can treat yourself more often and increase the frequency of how often you check out your favorite restaurant. There’s nothing that most of us love more than the convenience of going out for food. If you worked hard to increase your salary, there’s nothing wrong with eating better. You can eat out with your friends or form a new weekly tradition.
Next, you can cut out a redundant task from your schedule. Is there something that you’re annoyed by? We all have a task or two in our routines that we wish we could eliminate. Some of my friends have hired maids or someone to perform their lawn care. Some young folks would rather spend more time on the productive tasks while eliminating duties that don’t add much value, yet need to be performed.
The best part is that there’s no need to feel guilty about hiring someone to cut your grass, shovel your snow, or clean your apartment. You’re going to pay for this with money that you worked for. Why work so hard if you don’t seen any results or positive changes?
These two new luxuries alone will often be enough to allow you to appreciate your new raise. You’ll notice an upgrade to your lifestyle because you’ll be eating your favorite dishes more often and you’ll have cut out tasks that you don’t care for.
Have you recently increased your income? What did you do with your new-found income?
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