You’re making more money than you did at your first job, so why does it feel like you’re still scrambling to pay the bills, or end up needing to pull out a credit card more often than you like?
Blame lifestyle creep—a sneaky phenomenon where the more you make, the more you spend, making it impossible to ever feel like you’re truly getting ahead. The good news is, once you recognize lifestyle creep, it’s easy to combat it — after all, you managed to survive on a much lower salary just a few years ago, right?
Here you’ll learn how to find the places where you’re slipping to nip it in the bud, as well as some of the best tips to help ensure lifestyle creep won’t crush your savings.
Think about your daily habits five years ago:
What gym did you go to?
How much did it cost?
Was coffee an everyday purchase or a rare treat?
How often would you go out to dinner, and would those dinners out tend to be a slice of pizza or a burrito, or a sit down meal with a few glasses of wine?
If you want to go even further, you can even go back and pull bank account statements from five or so years ago.
How much do you pay on housing now, and how much do you pay then? By taking a then-and-now view, you can begin to see how lifestyle creep affected your own spending habits, which can help you easily spotlight places you need to save.
For example, maybe five years ago you worked out at your campus gym, but now, you take a boutique boot camp class. That’s an extra $100 a month you could save without really missing it. You made do then with some free weights and a treadmill — why not now?
New paycheck, new pad, right? Not so fast.
While it’s tempting to think of all the ways you could upgrade your life when you get a promotion or bonus — after all, you worked hard for it and you deserve it — consider socking aside the extra and living your life on the same amount of money you were used to living off in the past.
Even splitting the difference, using half of your higher salary to upgrade your life, and the other half to sock away to savings or paying down debt, can make a huge difference.
When you have friends who make a higher paycheck than you, it’s easy to drift toward their spending habits. And that can all too easily happen when we all climb the corporate ladder at different rates and shift into various career sectors.
For example, maybe your group of friends all felt broke in college, and bonded over finding the best happy hours in town. Now, ten years later, some of these friends may be making multiple times your salary, and you may find yourself meeting for pricy cocktails.
Seeing the way these habits have shifted can help you suggest other ways to socialize. While you don’t need to meet for 50 cent brews again — unless you want to! — suggesting to meet for walks, runs, movie nights, or dinners at each other’s houses can help tame expenses.
Financial advice that urges you to give up your AM latte, or skip the gym in favor of running outside isn’t one size fits all — and it can be frustrating to try to avoid the things you love that makes life a little sweeter.
Instead, take cues from how you indulged when you had less wiggle room in your budget. Maybe you always went to the gym, but you only splurged on a coffee once a week. Or maybe you met friends for bagels instead of brunch.
Try to pick up as many “old” habits from your old life, just as an experiment, and see what sticks.
As our lives have evolved, so too, has technology, and in the past few years, it’s become easier than ever to get everything delivered to your door.
For a week, as an experiment, try buying everything you need from a brick and mortar store. While it may be annoying, you may see that you’re spending money on some things just because it’s easy, and they’re right there.
When you have to go out and buy things — like you most likely did a decade ago, or may have done when you lived somewhere it wasn’t easy to get package delivery — you may find yourself being more deliberate in how you spend your cash.
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Anna Davies is a writer specializing in personal finance who’s written for Refinery29, Cosmo, Elle, Glamour, the New York Post, Conde Nast Traveler and others. When she’s not working, she loves going on adventures and traveling with her 2-year-old daughter.
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