After the graduation caps are tossed in the air and the realities of impending student-loan bills sink in, millennials (we hope) scurry off to the rat race. Many fresh-faced college grads are receiving their first paychecks above minimum wage and — at the same time — their introduction to lifestyle inflation.
In the simplest terms, lifestyle inflation is the practice of increasing your spending in correlation with a higher income — and frequently, spending all of that new income, or more.
Lifestyle inflation in high school meant using every cent of your pitiful paychecks from Applebee’s to buy spaghetti-strap tops, go to the movies, and fill up the tank in the old clunker you shared with your three siblings.
In post-collegiate life, a starting salary of — let’s say $30,000 — can offer a drastic increase in spending power from those days of filling orders for boneless buffalo wings.
Unfortunately, for those who funded college with student loans or took advantage of easy, pre-approved credit card applications (pre-credit card reform) — that $30,000 seems to disappear all too easily.
Read the rest on DailyFinance!