Many folks are currently dealing with a toxic combo of inflation and lifestyle creep. And with economic storm clouds on the horizon, it may be a great time to push back against lifestyle creep in particular.
You see, the pandemic era excesses of money supply and skyrocketing asset prices gave a false sense of security, thereby ramping up consumption beyond normal levels. Remember it wasn’t that long ago that people were buying NFT’s, what the heck is an NFT? Whatever it is, it’s a speculative investment that signals excess.
Now that most assets came back down to Earth, there is need to deal with lifestyle creep. See, people that were buying NFT’s were probably also buying expensive meals, designer clothes, fancy high priced cars and on and on.
Lifestyle Creep is the Slow Killer
A big problem with lifestyle creep is that it is death by a thousand cuts to wealth building. And at its worst can result in a family claiming bankruptcy and losing it all. Best to get it tamed as soon as possible and take a hard nosed look at your spending.
Hedonic Treadmill
This is the term we need to understand. The HT or Hedonic Treadmill is the concept as humans that we quickly adapt to a higher standard of living. And over time the luxuries start to feel normal and we need more and more higher highs. It is a lack of perspective and a lack of valuing what we currently enjoy.
We do not know why as humans we are wired this way. Perhaps it has to do with survival and just living in the moment and relishing abundance when it came to our ancient ancestors. Perhaps it served as a kind of metal break from what was typically a rather grueling existence? Whatever the reasons, it is not good for our modern mental health or wealth building.
HT leads to lifestyle creep
Lifestyle creep is the idea that everytime we get a raise or make a little more money, we tend to find some way to spend it quickly and increase the luxuries of our lifestyle. It is no longer keeping up with the Jonses but keeping up with the Kardashians. Literally millions of people watch people with extraordinary amounts of money and aspire to that rare and fake lifestyle presented on TV.
3 Ideas, Go On Offense Against LC
Here are 3 ideas to implement to go on the attack against lifestyle creep. See, inflation requires defense systems. Over the last year the Money Vikings put in place IDS’s, Inflation Defense Systems. Now is a good time to go on the attack against lifestyle creep.
One: Buy Nothing Groups
The first way to fight lifestyle creep is to have your cake and eat it too. How you ask? Consider local Buy Nothing Groups. These are local communities of folks that literally list items the their neighbors can come pick up from their front porch. People give each other almost anything you can think of.
These groups foster a sense of community, reduce loads in landfills, reduces spending and helps others.
Two: Thrift Stores
Harnessing the power of thrift stores helps to defend against lifestyle creep. Many thrift stores have designer clothes and many nice household items.
Three: Resale on eBay
Perhaps we overdid it with the spending over the last couple of years and just have too much stuff. Consider selling high value items on eBay. It’s easy to type in a description of an item and get a sense of if it is selling.
Four: Foster Some Perspective
The hedonic treadmill makes us quickly lose perspective. We psychologically believe that our new higher standard of living is the new normal. We must resist this perspective and create a broader and healthier perspective. Learn about how most people live in the world. Count your blessings. Do we have clean water, food, housing and other fundamentals? If so, then any added luxury is just that.