Who doesn’t like to earn some extra cash? And when it comes for free who won’t like to think of the thousand ways to spend it?
Of course, everyone does, think of the last time you receive a bonus for doing overtime in your workplace or think of the last time you was promoted and your salary was raised, I bet that feeling must be so pleasing for you that you might have thought for once to go out and celebrate this little happiness of yours!
And with that being said, after living a life full of sacrifices and keeping yourself limited to the luxuries, getting a bonus or a raise can be equivalent to winning a lottery for yourself.
And spending this extra cash is part of natural phenomena.
But with that being said, try not to squander your extra earnings on short-sighted purchases.
This cash can prove to provide you an esteemed value for your money, but in this regard, you need to resist lifestyle inflation, and we will guide you on how to tackle it in a profound manner!
What is Lifestyle Creep?
First thing first, lifestyle creep is a phenomenon that usually occurs when someone upgrades their lifestyle or the way of their living when they witness an improvement in their discretionary income.
This raise in income can make the former luxuries become new necessities.
Getting extra cash can only be possible in two ways, your annual salary gets increased or the cost of the items you purchased decreases.
And this is when lifestyle creeps hit you, you start spending on the things that aren’t necessary for you.
You started wasting your money on non-essential items.
With that being said, the money you just wasted on unnecessary things could have been saved or invested into small or short-term liabilities that would have provided esteem value for your money.
That’s what makes it more important for people to avoid lifestyle creep before it’s too late.
How to Avoid Lifestyle creep?
With lifestyle creep, you start to consume luxuries like it is was meant to be your right in the first place, and this is where things tend to take a wrong u-turn.
Though it will provide you with extreme pleasure at the initial stage, which will raise the urge to keep wasting your money on unnecessary items.
However, you will get to come across the consequences of lifestyle creep when your income gets decrease back to normal, or when you lose your job for some reason.
And on the odds that nothing like this happens, then you will be facing its drawback in the longer run, as every one of us will be retiring one day, and the people who wasted their savings on non-essential things won’t have a single penny saved for their retirement period.
With that being said, it becomes extremely important for you to avoid your progress being hindered by lifestyle creep.
And in order to do it in a profound manner, a list of factors are being provided to you below that will surely prove to be worth enough to keep you safe from lifestyle creep and will surely provide esteem value for your money.
Create A Fun Fund:
As far as saving is extremely important for one to make sure to keep his future safe, however, on the other side, it’s important for you to throw yourself a treat and spend a quality evening while being in your budget so that you don’t feel left out or deprived of fun.
This can be done in an extremely simple way, all you have to do is to create a fun fund for yourself, deposit a larger fraction of the extra cash you earned into savings and keep the rest of the amount to be spend on unnecessary items.
With that being said, let’s suppose that you earned a bonus of 200 dollars.
To avoid lifestyle creep, you can deposit 150 dollars to your saving accounts and can allocate the remaining 50 dollars to be spent according to your personnel preference.
Prioritize Your Well-Being First:
In a time where the world is progressing at an increasing rate, every individual needs to look after his own needs first.
You don’t need to get yourself, dependant, on anyone once you get retires from your workplace.
And in order to prevent this fact accordingly, you would need to look after your future plans and consider the way you can keep this extra cash save with an intention to use it when you run out of cash.
One and the most simple thing to proceed with this operation is that as soon as you get get your hands on your bonus of extra cash from your salary, first thing first, deposit that amount straight into your saving account.
Once you added this extra cash into your saving account, forget about the fact that money exists.
Carry on by getting on with your previous specific budget and spend your money wisely.
In this way, you will be able to save tons of dollars for yourself by the time your retirement age arrives and will live a quality retirement living with your family for sure.
Make Notes Of Your Goals:
What counts as the worst threat of lifestyle creep is that it can hinder your long-term long term goals and your future plans.
Many of you may have some plans for your future, for example, purchasing a home for yourself on your desired destination, paying for an orphan child’s college fees, or going on your dream European vacation.
And in order to succeed with your plan and achieve your goals, you need to have a handsome amount of cash, which can only be achieved by saving up your earnings.
A little 20 dollars spent here, and a little 50 dollars spent there can add up quickly and will prevent you from increasing the zeros of your savings account.
With that being said, according to the professionals’ advice, you should write down each and every goal of yours that you need to fulfill one day.
And keep that piece of paper in your wallet along with your credit card.
Every time you would take your credit card out to spend some money, that piece of paper will pop out too, which will remind you of your dreams and hence will keep you safe from wasting your money on unnecessary items.
This is, for now, the most sorted and one of the best tips you can ever receive in your life.
Make Gradual Changes:
One common mistake people make lately is that whenever they get their hands on some extra cash, they tend to spend everything once for all.
For example, if you have been sacrificing all your life and are living by your old furniture, then getting a new one for yourself with this extra cash can prove to be fruitful for you.
Buy one that comes within your budget, but refrain from buying anything with your furniture.
Try making gradual changes, replace your furniture first, then after some time replaces any other item, but keep your gap maintained.
Though gradual upgrades consume time, they are worth waiting for!
Surround Yourself With Good Company:
Last but not the least, surround yourself with good company.
Try to become friends with people who encourage you to save your money for your future and help you out in every possible way to make sure that your future is safe.
With that being said, what else are friends for if they haven’t got your back?
We all are well aware of how hard work and dedication it takes to earn money and to look after yourself and your family.
Don’t let your hard work go in vain by spending all of your money on non-essential items. With that being said, the above tips would surely prove to be of immense help to keep you safe from lifestyle inflation.
Don’t let worldly affairs fool you, and save as much as you can in order to get a better stable future for yourself.