Lifestyle Inflation: How to Earn More, Spend More, and Get Nowhere

IMG_1263After 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.

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11 comments on “Lifestyle Inflation: How to Earn More, Spend More, and Get Nowhere
  1. Enjoyed reading the post. It just remind me about my student life and loan.

  2. debtnthecity says:

    Completely agree with your last line. The majority of my shiny new income goes towards debt repayment 🙁
    debtnthecity recently posted…Charity on a BudgetMy Profile

    • Broke Millennial says:

      And soon it will be able to go into savings and investments! Congrats on doing what it takes to get out of debt.

  3. What is up with the comments on that post? They’re getting slightly off topic, aren’t they? =)
    Holly@ClubThrifty recently posted…Breaking Bad: What Would You Do?My Profile

  4. It makes me think of when high school students who were overprotected and had heavy restrictions go crazy with drinking once they hit college. I think everything is shiny and new and there is that mentality of “deserving” something. I was there myself.
    Budget & the Beach recently posted…Feeling the Power to Change Old Financial WaysMy Profile

    • Broke Millennial says:

      That’s a great analogy – as an RA I remember those freshmen all too well.

      The deserving mentality is the nemesis of savings.

  5. Student loans are getting in my way of inflating my lifestyle! Haha just kidding, but it is unfortunate how much of my income goes towards it.
    DC @ Young Adult Money recently posted…How to set up a functional and comfortable Home OfficeMy Profile

  6. I enjoyed your article. I was lucky and didn’t have any student loans. Then I proceeded to save almost every penny of my post-school income to get married and to put down a downpayment for a home. My husband (boyfriend) at the time, had $30K work of student loans and his income went to repaying that.

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