12 Ways To Stop Lifestyle Inflation In Its Tracks

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Becoming aware of lifestyle inflation is one of the most important things you can do if you want to live a comfortable life within your means and put plans in place for the future. People tend to spend more as they earn more, thinking that it’s the way life should be. However, just because you can, doesn’t mean you should. Being smart with your money is key. You deserve to treat yourself from time to time, but that does not necessarily mean buying every impulse purchase, having the most expensive car, and having the biggest house.

We’ve put together twelve ways you can stop lifestyle inflation in its tracks. Take a look:

Don’t Try To ‘Keep Up’ With Others

Trying to keep up with others, whether you’re aware that this is what you’re doing or not, is a very dangerous way to live your life. Remember that Instagram is not a complete picture of somebody’s life, and although they may have an amazing car, they may also have a huge debt to go along with it. People may only let you see into the best parts of their life both online and in person. Concentrating on your own wellbeing is key – never, ever compare yourself or what you have to somebody else.

Consider What Will Really Improve Your Quality Of Life

You can spend money. You don’t need to completely cut out everything you like and care about. However, you should try to be objective about what will really help you to improve your quality of life. You can buy a secondhand car that isn’t too expensive to run, and will be a much smaller drain on your finances than a brand new car that costs a fortune to run and insure.

Your priorities are always going to be different to that of another person, so take your time to decide what will improve your quality of life.

Have Regular Money Meetings

Having regular money meetings, even just with yourself, can help you in so many ways. It forces you to keep an eye on your budget, plan for things coming up, and ensures you’re always on track to reach your goals. If you live with others, having the meetings with a partner encourages an open and honest dialogue. If you involve your kids, you will teach them valuable lessons for the future.

Value Experiences Over Things

Buying physical things gives a high, but a short lived one in comparison to exploring somewhere new. When you value experiences over things, you will become richer in mind and spirit. They say that travel is one of the only things you can spend money on that will make you richer!

Spend Less Time With People Who Encourage You To Spend More

Take a look at the people you are closest to and figure out whether any of them make you feel like you should be spending more. They may not do this on purpose – if they are constantly spending money around you, then you may naturally want to do the same. However, you become like the people you spend the most time around. If you want to avoid lifestyle inflation, you should spend time with other financially aware people.

Come Up With A Reasonable Budget For Everything

Budgets aren’t just for people who struggle to make ends meet. A budget is a smart way to ensure you’re not overspending in any area of your life, and that you have money left over for fun stuff, investments, savings, and more. You could try the envelope method, where you allocate a specific amount of money to things like food, and then place that money in an envelope. You don’t take cards with you when food shopping, and aim to keep the total below the amount in the envelope. If you manage it, you don’t take the money out of the envelope to put towards anything else – you simply top it up.

This is a great way to save money in the long run and ensure you’re not overspending on anything!

Don’t Let Utility Costs Go Unchecked

The cost of your lifestyle will gradually creep up if you don’t keep an eye on your utility bills.  If you live in the U.K, check your supplier contracts. Each year you should look for better deals and approach your supplier to see if they can match them. More often than not you’ll get a much better deal. If you let them roll over, you’ll spend so much more than you need to!

Here are some useful tips on getting better deals with your utility suppliers.

If you live in sun-drenched areas, you may want to consider the long-terms savings of going solar for part of your utility requirements.

Always Use Discounts And Voucher Codes

Stay frugal – no matter how rich you are! Many famous people are still frugal and know they need to manage their money effectively. Even stars Sarah Michelle Gellar and Kristen Bell enjoy using coupons! Check out sites like Net Voucher Codes before shopping to make sure you’re getting the best deal available. If you don’t do this, then you’re just wasting money. You can also use a cashback site to see if you can make a small percentage back on your purchases.

Know What Your Priorities And Goals Are

When you know what your priorities and goals are, you can work towards them, safe in the knowledge that every bit of your money is being put to good use. Consider what you really enjoy spending money on, and what the most important things in your life are. Make sure you also think about where you’d like to be in 5-10 years time, and what your plans are for retirement.

Knowing exactly what you value will help to guide you in your spending. This is a strong defense against lifestyle inflation in the long term.

Limit Impulse Purchases

Impulse purchases can give us a great rush, but this is short lasting. We also sometimes find that once the rush has worn off, we didn’t really want or need the item in the first place. If you have the urge to buy something, waiting a few weeks will give you a better idea of whether you really want the item or not. If the urge goes away, you have automatically saved money!

It can be difficult to force yourself to do this, but you’ll end up saving money and making far more satisfying purchases in the long term.

Automate Your Finances

Automating your finances is a smart way to stay on track. Can you automate your savings so that you don’t even have to think about the money? Setting and forgetting it is an effective method of saving in the long term and you won’t be tempted to spend the money. Set up a direct debit to your savings account, even if it’s just a small amount to begin with. You can gradually increase this amount as you make positive changes to your budget and spending.

Boost Retirement Contributions With Each Raise

Rather than spending more money the more you earn, boost your retirement contributions. This will ensure you’re set up for a far more comfortable future and that you can have peace of mind. Whenever you get a raise, allocate a large portion to your retirement contributions and any other goal you have your mind on. You won’t notice the difference to your lifestyle, but you’ll work towards your goals so much faster.

How are you going to make sure you keep your lifestyle inflation under control? Leave your advice and thoughts below. Thanks for reading!