I’ve been tracking our spending for six months and the lowest amount I’ve seen us spend in one month is just over $8,000. I did some quick math and our average monthly spending for the past six months is $11,427.37. Looking at these numbers I honestly can’t recall how I survived when I was in my 20’s. I was working as a waitress and putting myself through college on roughly $2,000 a month back then and now I find myself struggling to get our monthly budget below ten grand.
I realize that lifestyle inflation happens to everyone as they get settled into careers and their earning potential increases. The more you make, the more you spend; all in an effort to achieve your highest possible living scenario. The “American Dream” leads us to strive for the next best thing.
The apartment that you once loved becomes the dream home in a good school district. The old beater car you got as a teenager becomes the upscale SUV. The ramen noodles and peanut butter sandwiches that sustained you in college becomes organic chicken and local cage free eggs. This seems to be the case in every one of my own spending areas and it makes me wonder why this happens.
Examining my own life reveals many reasons:
- After years of living on student loans and not being able to afford to spend money on anything besides basic needs, I graduated with an attitude of entitlement. Feelings of “I’ve earned this” or “I deserve this” became a common theme in my early thirties.
- Social pressure increased as my salary increased. I was working side by side with other high earners (surgeons and anesthesiologists) and I watched them buy expensive cars and homes which made me feel like I should buy those things too.
- I had a child and suddenly everything needed to be better, cleaner, safer and organic. Only the best would do for my baby.
- I developed a belief system where the things that I own represent my success to the world…and I wanted the world to know that I had made it.
The elevation in living standards that comes with lifestyle inflation makes it really hard to go back to living like you did before, especially when you can easily justify the increase in standards:
- The expensive clothes last longer because they are better made.
- The more expensive preschool will set my daughter up for success in her future education.
- The more expensive car requires less maintenance.
- The organic food will keep us heathy.
- The more expensive house is in a safer neighborhood.
I can’t think of a single person in my own life whose spending looks different. The financial independence community that I found online seems nonexistent in my neighborhood, town, and workplace. I’m surrounded by coworkers who still have extensive amounts of student loan debt yet they buy new houses and take luxury vacations. I can’t think of one single doctor I work with whose kids goes to public school. Monthly subscriptions, organic food, fancy schools, new cars, personal trainers (guilty), house keepers, lawn care companies, landscapers, fake eyelashes and monthly nail salon visits…the list goes on and on.
I remember my first apartment, furnished with hand-me-downs. I was so proud of that place. I had to work two part time jobs to pay my bills, I lived on bologna sandwiches, and had maybe $25 dollars left over at the end of the month. I WAS SO HAPPY! I finally had some freedom in my life. It didn’t matter that I had to sleep in the living room in the summer because the air conditioning wouldn’t reach my bedroom, or that I didn’t have a table to eat my food at, because it was mine and I loved it.
It makes me sad to admit that I would never let my daughter live in the same apartment. Does success make you a snob or is it just a natural progression of the human nature to want more? I’m really not sure. I just know that I’ve had a taste of the good life and I’m finding it hard to scale it back as efficiently as I would like too.
So how does one “un-inflate” their lifestyle?
I’ve read some blogs by people who have taken drastic measures in the name of financial independence. Some have sold their homes and moved into tiny houses so they can be mortgage free and some have sold every position they own to pay off debt. A famous member of the FI community is Mr. Money Mustache. He rides a bicycle everywhere he needs to go. Can you imagine going to the grocery store and hauling it all home every single week…on a bicycle?! Yeah me neither.
Dave Ramsey recently wrote on Twitter “If you’re working on paying off debt, the only time you should see the inside of a restaurant is if you’re working there.” So wait, I’m not allowed to eat out at all until my debts are paid off? I’m not interested in removing all the pleasures of living so I can be financially independent.
Lifestyle inflation didn’t happen over night. It’s going to take time for my habits to change and I want those changes to be permanent. Personally, I have never done well with major change that happens quickly. I prefer to take baby steps and make small changes, knowing that these small changes lead to big results over time.
My “No Buy Year” is the most drastic change I’ve made and yet, it is made up of small changes that seem manageable to me. There’s no way I would have been successful if I said I couldn’t spend any money at all in 2020. Instead I allowed myself restaurants and entertainment, gardening supplies, used books and the ability to replace certain items when needed. This way I don’t feel deprived and want to quit.
There are times when I wish I could be more drastic. Times I wish we could sell it all and snuggle up in an RV and travel the country as a family. It sounds romantic doesn’t it? I bet I could get some amazing instagram worthy pictures of us living our best life, off grid in the woods somewhere. It’s easy to get caught up in the idea of a drastic lifestyle un-inflation. The reality is that there are too many reasons to stay in good paying jobs, live in a home that doesn’t move, and maintain a stable existence.
We will eventually see bigger decreases in our monthly expenses. Our daughter starts public school this year and we will only have to pay for after-school care, a savings of about $500 a month. Our grocery budget has decreased since we cancelled our Costco membership and I have really started to meal plan and pay more attention to what groceries we purchase, another savings of about $500 a month. We are trying a cheaper cell phone provider in hopes of saving money there too.
I believe that there are many ways I can make cuts to our budget that won’t make my family miserable, affect our health, and deprive us of all joy. While they won’t add up as quickly as selling a $40,000 car or avoiding restaurants for a few years, they will add up. Seeing these results every month will create a consistency that leads to new spending habits and a slow un-inflation of our lifestyle.
I’m not sure it’s possible to return to the inexpensive ways of my youth. Life is too different now and I’m grateful for that. As happy as I was to be single and free I’m much happier now, even though the pressures are different and life is more expensive.
What changes are you making to un-inflate your lifestyle? Feel free to leave me a comment. Thanks for reading!