“Lifestyle inflation is one of the biggest enemies of retirement. Of course, we will run into other problems such as unexpected health care issues, economic downturns, and our children’s education. However, lifestyle inflation is different because it is completely under our control. Most of us can do a better job at minimizing our lifestyle inflation, but it is very difficult to resist the urge to spend more when you make more,” Joe Udo wrote for the U.S.News & World Report LP, republished by Yahoo Finance online late last week. Udo continued, “We all want to be comfortable and live a better life. I’m not immune to lifestyle inflation either. When I first graduated from college and earned a good paycheck, my expenses went way up. It’s been trending up slowly since then, but I consciously try to minimize it even as I earn more income over the years. We live in a modest home, drive a regular car, and eat out about once a week. Many of my colleagues purchased McMansions, luxury cars, and spared no expense on entertainment. They are prioritizing luxurious living now over an early retirement, but that’s their prerogative.” Read the full article, which includes an outline of how you can avoid lifestyle inflation, here. | Raymond Matt, CFP, CLU, TEP, CHS
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