What is lifestyle inflation? Lifestyle inflation refers to an increase in spending when an individual's income increases.
When a person gets a raise, they tend to spend more money to buy extra goods and services and live a more luxurious lifestyle. This in turn causes them to be trapped in the paycheck-to-paycheck cycle.
So no matter how much income they bring in, they can't move forward. Lifestyle inflation can make it difficult to reach financial goals such as becoming debt-free or saving for retirement.
To avoid lifestyle inflation, increase the amount you're saving. Pay attention to your spending choices. Don’t go overboard when you do decide to treat yourself.
TODAYS MOST POPULAR
December 3, 2022
December 1, 2022