Gradual Increase in Spending Can Sneak Up on You
Comedian George Carlin once humorously pointed out that the desire for what others have is deeply ingrained in our society. When someone you know flaunts a new possession, whether it be a gadget or a luxury item, it’s human nature to start desiring the same thing, especially if they keep boasting about it. While it’s natural to occasionally treat yourself to something that enhances your life, it becomes problematic when these indulgences become a frequent occurrence. This phenomenon is known as lifestyle creep.
Lifestyle creep is a modern twist on the classic concept of “keeping up with the Joneses,” which signifies feeling inadequate for not matching the wealth and status of those around you. The key distinction with lifestyle creep is that it involves gradually getting accustomed to spending more money on things that are not essential. It transitions from a competition with others to a habitual pattern of overspending.
Let’s envision a scenario where you receive a substantial bonus at work. It’s a great opportunity to reward yourself! You decide to splurge on a new wardrobe filled with expensive clothes that were previously out of your budget. However, when you compare your new clothes to your existing ones, you feel a discrepancy. To maintain consistency in your wardrobe, you purchase more new clothes. Then you realize your plain dresser doesn’t complement your fancy attire. Consequently, you start considering upgrading your entire room to match the new dresser – and the cycle continues.
While treating yourself occasionally is acceptable, it’s crucial to prioritize saving for future needs. Otherwise, you might end up with a collection of extravagant possessions and no financial security. Remember to strike a balance between enjoying today and securing your future.