BEING MINDFUL OF YOUR LIFESTYLE UPGRADES

LIFESTYLE UPGRADES

Overtime when we are not being mindful of our spending, we can begin doing things like upgrading the car, skipping the bagged lunches and eating out more, buying more expensive wine or coffee, buying more expensive groceries, going on more expensive vacations, etc. While some of these things may be important to you, if you are doing them without really being mindful about them you may not even realize it is happening. Sometimes we may feel the need to upgrade our lifestyle because we received a raise or a promotion at work. Or you might just start feeling discontented with your current lifestyle and want something new or different.

There is nothing wrong with upgrading your lifestyle or getting nicer things that you really enjoy. But when we do it without really giving it too much thought it can prevent us from achieving the financial goals that we may have. As we start using more discretionary income on these upgrades there is that much less left to achieve our goals. When we continue to make lifestyle upgrades without really being mindful about it, we can end up living paycheck to paycheck regardless of our annual income.

THE NEWNESS AND EXCITEMENT OF LIFESTYLE UPGRADES WEARS OFF

While lifestyle upgrades create a lot of joy in the moment, that often wears off. For example, I heard a stat about how long the exciting feeling lasts when you purchase a new car. I don’t remember exactly what the stat was.  However, it basically said that individuals that purchase these really high-end cars with all of the options feel really amazing about it for a pretty short period of time. After a while, they are just driving in a car.  Unless the car they purchased had specific upgrades they really love and use over time, the feeling they have driving to their destination is no different than when driving in their previous car.

TRY TO KEEP SOME THINGS FOR SPECIAL OCCASIONS RATHER THEN UPGRADING YOUR DAILY LIFE

When things that were once fun and special are just part of the norm, it can put us in a place where we are always looking for the next better thing. We can begin continuously upgrading our lifestyle as each of the previous upgrades no longer has an effect on our happiness. For example, if in the past you only went out to dinner for special occasions.  When you went out to dinner, it would feel special and be a real treat. If you start going out to dinner every Friday night because you are now earning more income, it no longer feels like a treat.  So, now when it’s time to celebrate something, you will have to upgrade the way you celebrate to make that feel special because going out for dinner is just part of your regular routine.

Maybe you used to buy a special bottle of wine to celebrate an anniversary or other occasion.  If you start purchasing that wine more frequently, it’s no longer special.  You need to find something new to celebrate with. A simple example is foods we only make during the holidays.  My daughter had asked me to make green bean casserole and some other holidays sides more often, kind of like part of our regular meal rotation. I explained to her that if we did that it would make the holiday meal less special because we would just be eating the things that we eat all of the time anyway.  What makes those dishes fun is that we only have them during the holidays. It’s the same thing with lifestyle upgrades.  If we upgrade too much, we take away the fun we had when those things were once just for special occasions.

BE INTENTIONAL WITH INCREASED INCOME

If you are not already maxing out your retirement savings, you could consider increasing your contribution rate at the same time as you receive a pay increase. This will limit you on lifestyle upgrades because you will never see the additional income. If what you really love in life is going out to dinner, then maybe that is an upgrade you choose to make.  You might want to put a portion of your additional income towards going out to dinner more often. But, when you are not purposeful about what you do with that income, you could spend it all before you have anything left to show for it. The point is that you want to be aware of any increased spending that you are purposefully choosing, and not just allow it to happen without any thought.

MAKE A LIST OF YOUR SAVINGS PRIORITIES

Instead of taking all of your increased income each year and doing as much as you possibly can. Try keeping a list of the things that you want to save for. These could be various home improvement projects, a vacation, new wardrobe items. Whatever it may be, keep a list of these things with the estimated cost and prioritize them. By having a list of your priorities you can choose to save for them and get them done in priority order instead of trying to do everything all at once. When you are in the habit of doing things based on your priority, you will likely take it a little slower and be more aware of what you are spending your money on.

REVERSING LIFESTYLE CREEP

If you feel like you have not been mindful about upgrading your lifestyle, it’s never too late to cut back on a few things. You don’t need to cancel all subscriptions and bring your life to a screeching halt. Just being to take a closer look at how you are spending your money. Decide what is really important to you and what is not. Maybe there are some upgrades you have made that no longer seem worth it to you that you can cut out. By taking the time to look at what you are spending your money on, you can take action to make sure you are only spending on those things that are important to you. You can then put that extra money to better use.

Thanks so much for checking in! If you would like to hear the podcast version of this topic to check out Lola’s Frugal Life Podcast! Also, be sure to check out my other blog posts on this site!

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