The Impact of Lifestyle Creep on Your Wealth...
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- เผยแพร่เมื่อ 12 ก.พ. 2024
- The Impact of Lifestyle Creep on Your Wealth...
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Bring confidence to your wealth building with simplified strategies from The Money Guy. Learn how to apply financial tactics that go beyond common sense and help you reach your money goals faster. Make your assets do the heavy lifting so you can quit worrying and start living a more fulfilled life.
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Lifestyle creep happens to those who don’t know what is important in their life, so they try to fill it up with whatever catches their eye. Love the focus Brian and Bo always come back to the Why.
This is the #1 most important financial advice anyone can ever give (or receive)
@5:54 I've found this is the best way to avoid lifestyle creep. Get used to a paycheck amount, then increase your automatic contributions as your pay increases. It's significantly easier to avoid that higher car payment or those new shoes if you don't see that pay increase in your checking account at all.
You have to remember to bump it though for inflation
Pay yourself first
I feel like lifestyle creep is not a problem unless you don't prioritize. For instance, if you take your 10% tithe and 25% investments out FIRST, if you lifestyle creep to fill up the rest it won't make a difference long term. You may even decide to do MORE than the 25% because you have more to work with. But that way, you won't even see that investment income so you won't be tempted to eat it up.
Good for parents to role model behavior for their kids. Our kids had a lot of conversations with their father growing up about “needs” versus “wants”.
We’re just a 2 person household w/ roughly 130 income and we feel extremely tight and we’re very responsible. Cost of living is crazy. Groceries have skyrocketed. Rent has skyrocketed. Insurance premiums have skyrocketed. Medical costs have skyrocketed. We live extremely modestly. No car payments, only debt is student loans, and when it comes to putting money aside for retirement and then saving for a down payments, we have nothing leftover at all. 130 is good income and we basically can’t afford to go out to eat
You've got to live in a high cost of living area. I bought and paid for a house while maxing 401k and paying tithe on a similar income in VA.
Mmmm something ain’t adding up.
My girlfriend and I make way less than you, to the tune of 30k less, we invest a lot of our income and we still have leftover cash for eating out. We live in Denver.
Yikes, where do you live? My wife and I have kids and make half as much as you. We live in Canada, and money is tight at times, but our insurance hasn't gone up and even our grocery bill hasn't increased much. We're really just focusing on our getting our income up so we'll be able to afford a house and not be renting forever.
Gosh, watching this was so good for my mental health! My husband and I made a decision to be disciplined and to live below our means as soon as we got married. As a result, we’re completely debt free, have a net worth of about 2 million (43 and 45), college savings for kids and a solid financial plan that will keep our assets growing even after our death.
What you guys said at around 4:13 about making good habits easy and bad habits hard was an epiphany. Even with all our financial success and having automated our wealth building plan, I worry about the lifestyle creep. You talk about bigger cars and bigger houses while I worry about buying a cream from Sephora that I would not even have considered 5 years ago 😂. It was a good reality check for me. It appears I did make bad habits hard for myself. The only significant expense I don’t feel bad incurring (within reason) is travel, but that’s my “why” so I don’t feel guilty about this one.
I swear, you guys are reading my internet history or something.
Keep the cars longer and don't care who has a new boat, cars, etc. When you retire ask these same people to go to Jamaica, or a cruise, and listen to all the excuses, You will have the money they will not.
I feel like I’m living paycheck to paycheck because of forced scarcity.
I’m so nervous when I get an adult job after college because I’ve been living off of $13k/year for nearly two years. I’m scared I’ll blow a $30-45k/yr income but I know I need to save up for retirement(don’t have one yet), a used car, and future trips I have planned:) as long as I keep that mindset I think I’ll be ok
Nothing to be scared about, follow these guys and you will be much better off in the long term.
Not in the bucket of people living paycheck to paycheck, but I also don’t like the term lifestyle creep. When I was born, my parents could comfortably afford to live in a brand new, 2500 sq ft house with 2 practically new cars and a boat while making an average income. That lifestyle nowadays while raising 2 kids and still investing significantly for retirement requires well above an average salary. It’s easy to find yourself sympathizing with others who are objectified as having lifestyle creep while they’re doing better than their parents and yet not able to provide the same to their family
Change the thumb nail. If only Bo knew what you did to him!
$170k means different things to ppl in NYC or SF Vs someone in Boise or San Antonio...
I don’t know how people do it on less than a 200k household income.
Where I live it's easy. Budget and discipline
Toys equals poor house !
Lifestyle creep is presented by financial influencers as a character flaw. That's complete BS. What, you seriously expect a 30-something family man with 3 children to have the same level of spending as a single guy in his early 20s? Come on, let's be real about this, it's just a talking point.
Brian acknowledged that he doesn't want people to be financial misers. You should use part of your raise for lifestyle creep but not 100% of it.
I don’t think that’s what they imply. I had to re-calibrate what it means to me as well. Buying a bigger, more expensive car or a bigger house after a promotion is lifestyle creep. Allowing yourself to go out to eat twice a month vs once a month in the same situation isn’t. Incurring additional expenses that go along with having children is not a life style creep, but you do need to look at your habits to ensure you can sustain the extra expense.