Why Less Is Often More

Lifestyle inflation is considered a wealth destroyer. We explain what this term is all about and what you can do about it.

Lifestyle inflation is similar to inflation in the economy: this phenomenon also leaves you with less money at the end of a period than at the beginning.

Inflation comes from the Latin “inflatio”. This means to inflate or swell. When there is inflation, prices rise. At the same time, your money loses value and you can afford less than before. This happens, for example, when a certain product becomes scarce and is therefore offered at a higher price than before. Sometimes inflation also happens gradually because prices rise from year to year. For example, a scoop of ice cream or a drink in a restaurant then costs more than it did a few years ago. 

With lifestyle inflation, you adjust your spending in line with your rising income. This means that you spend more over the years because your income also increases. If you want to push your income you also can try your luck at the Woo Casino.

How lifestyle inflation makes itself felt

With lifestyle inflation, you consume more and more. With lifestyle inflation, your standard of living increases as your income rises. During your training or studies, you may have got by on very little and rarely indulged yourself. But the more you earn, the more money you have available for consumption. What used to seem like a luxury item is now affordable. A new TV, restaurant visits and more expensive clothes – no longer a problem. The extra spending comes gradually and with every pay rise you can afford more, but at the end of the month you still have very little left over from your salary.

Lifestyle inflation describes precisely this effect. Instead of saving money from your rising income, you spend most of it again during lifestyle inflation because you have become accustomed to the higher standard of living. And you do this every month. This makes it difficult to build up wealth.

Lifestyle inflation: what you can do about it

Cooking with friends can help you counteract lifestyle inflation. It’s not easy to break away from habits and small daily treats. This also applies if you’re stuck in lifestyle inflation. Nevertheless, it is worth rethinking your own consumer behavior. This is the only way you will be able to put more money aside in the long term to save for the future – for example, for private pension provision.

The rule is: less is often more. If you want to get away from lifestyle inflation, it helps to change your habits and consume more consciously. This often leads to a more sustainable lifestyle. This can look like this, for example:

• Buy second-hand instead of new clothes. Not only can you save money, but you can also find individual outfits. You can also buy refurbished electronic devices or second-hand furniture.
• It’s better to sleep on it for a night before making a purchase decision. Do you really need a new cell phone or will the old one do for a while?
• Get an overview of your finances and spending. Set up a savings account and transfer a certain amount to it every month. Keep a budget book. That way, you won’t be tempted to spend it in the first place and lifestyle inflation will soon be a thing of the past.  
• Don’t be tempted by coffee-to-go or sandwiches from the bakery and take your own snack to work. This will also save you packaging waste. However, this doesn’t mean that you can’t treat yourself to anything at all. Every now and then, something tasty on the go is of course acceptable. Meal prep might also be something for you. 
• Instead of rewarding yourself with consumption, you can also go on excursions into nature. Of course, it also costs money to get from A to B. However, you’ll get more out of a day in the fresh air than from the tenth sweater of a certain brand. 
• Invite friends over for an evening of cooking together instead of going to a restaurant. Cooking together is not only fun, you can also improve your cooking skills and try out new recipes.

How you can save money in everyday life

1. save money when drinking: the bottle is always with you

We also want to take a sip of water or a wake-up coffee on the go. Simply pack a refillable bottle or thermo mug that you can fill with tap water or coffee on the go. This little extra reach for your own bottle requires a little rethink. However, as with many things, it will soon become routine and you will no longer leave the house without a bottle or cup.

2. saving tip: Never go shopping without a cloth bag

The good old jute bag is no longer the flagship of the first eco-generation, but has become a popular hipster accessory. You probably have more than one cloth bag at home – keep one at work, one in the car or under the bike seat and one at home near your keys. That way you won’t forget it when you go shopping and you won’t need to buy a plastic or paper bag.

Last Updated on December 27, 2024 by soubhik