An Honest Look at My Lifestyle Inflation Over the Past Year

You guys, having my blog as a written account of my money for the past year is so crazy. I was looking back through my old posts, and I can’t believe how much my life has changed, from what I actually earn and spend to my beliefs and values with money. I thought it’d be fun to take a look at how my lifestyle has changed (read: inflated) since only one year ago, and reflect on how my beliefs have changed along with it. I pulled these numbers from my December 2018 budget post. It’s important to keep in mind that I was still paying off debt, and had $900 of my income going towards student loans during this month. Check it out!

Rent & Utilities

December 2018: $622

Now: $980

This is the biggest inflation in my budget, as I always expected it to be. I knew that once I got out of debt, I wanted to move to a central location in DC, so I had come to terms with the fact that my housing costs would jump up so much. This was an increase in expenses that I had fortunately come to terms with early on. I still have no regrets about this, which is huge for me.

Groceries

December 2018: $110

Now: $180

I definitely didn’t expect this to change by so much– I thought my grocery budget wouldn’t go over $150/month. But living with another person in an area with a higher cost of living has led to a much more significant change. I’ll admit that this was unplanned and took me longer to come to terms with, but now that I understand the change, I don’t stress it. 

Going Out

December 2018: $130

Now: $200

I definitely expected this one to go up. Even while I was in debt, this increased to $150 and I still had a tough time staying within my budget. In fact, I still feel the need to monitor this spending category closely in order to not go over, and sometimes I still do. I feel like it’s much more balanced, but still not the ideal amount for me month-to-month. I used to beat myself up about this type of spending, too, because I felt that it was unnecessary and represented a lack of self-discipline. I don’t feel that way anymore– I understand on a deeper level that I get to choose where my money goes, and meals/drinks out with friends– and sometimes even alone– are well within my values. 

Subscriptions & Miscellaneous

December 2018: $72

Now: $98

This is a smaller change that has led to more room for me to cash flow purchases, mostly for the apartment as of late. Most recently, I used it to purchase a planner for 2020, tickets to events, and bar stools for the apartment. In the past, it’s been my clothing fund, but I haven’t purchased clothing in months at this point. I’m actually saving slowing using an app to do a bit of a wardrobe overhaul, so I haven’t been tempted to buy clothes frequently.

Savings & Investments

December 2018: $835

Now: $1,200

Most people don’t talk about this as lifestyle inflation. In fact, folks in the personal finance world focus on avoiding lifestyle inflation in order to save & invest more as your salary increases. That being said, I want to include it in this post because, while it’s not the same type of instant-gratification lifestyle inflation, I definitely count my ability to save and invest more as a huge upgrade in my finances. It means I worry less about expenses that I know are coming up in the mid-term and the long-term. 

Why so much change?

Overall, I think these numbers show a huge change in my values about money over the past year. I used to talk about avoiding lifestyle inflation like the plague, and for a long time, only accepted that I would see a significant change in rent. I thought my other expenses would increase by very little, and that I’d be saving and investing more than I am now.

I can’t say exactly what changed, but I think it has something to do with the wide range of money perspectives I’ve sought out over the year. I actually think lifestyle inflation is– in many cases– a really good thing. I am so much more balanced in my life and healthy with my money mentality. I think the idea that lifestyle inflation is bad came from the deprivation mindset that I’ve been working so hard to shed. Obviously, this kind of increase in expenses is bad if you are going into debt or failing to adequately save for your future, but that doesn’t mean saving less that you possibly could be saving is the end of the world, either. 

Keeping a record of my budget has made it possible for me to look back at my finances and reflect on how my life and beliefs have changed. If you’re ready to start tracking your finances to do the same, click the button below to receive a free copy of my budget spreadsheet.

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I’ll be taking next week off for the holidays, so expect a new post from me on December 30th!