A six-figure salary is something that many people aspire to. However, those zeros do not necessarily add up to a rich life. Building wealth is not about earning six figures, it’s about what you do with what you have!
Being the Joneses
Many people think that emulating a rich lifestyle will make them rich. As their income increases, they aim to have the latest brands of everything from gadgets to cars, holidays, and clothing. Their quality of life is always in rivalry with friends and colleagues, who sometimes are not aware of the competition and can truly afford their life choices. Unfortunately, their mirroring neatly places them in a hand to mouth cycle, because they inflate their lifestyle every time their income increases. Regrettably, this kind of lifestyle leaves them stuck in a rat race.
What is lifestyle inflation?
Lifestyle inflation is when one lives above their means. In simple terms, it’s living a life that you can’t afford. Usually, it is debt sponsored and informed by the wrong wealth values and perceptions. Wrongful wealth values and perceptions lead to detrimental financial behavior such as lifestyle changes and upgrades each time one’s income increases. For example, upgrading a car to the latest make or dropping your morning walks for an expensive gym subscription at an upmarket place. Such choices consume whatever gains you would have made in income and deprive you of a chance to invest and grow.
Changing your lifestyle choices
If you are in a rat race right now, it’s not too late to make good lifestyle decisions that will improve your personal financial health. The first thing you need to know is that looking rich does not make you rich. Assess your financial position and adjust your lifestyle to your true financial or wealth position. Secondly, remember that real wealth takes time to build therefore your daily actions build-up to your financial destination point. Don’t they say a journey of a thousand miles begins with a step? Take the financial step and do not be discouraged by your income; it does not determine how your money will work for you. Focus on the principles that lead to financial freedom, regard common financial sense and be intentional
“Blessed are those who have mastered the art of wealth creation, for they shall reap the rewards. “