The following post is by MPFJ staff writer, Chonce. You can read more articles by Chonce over at her personal blog, My Debt Epiphany. Enjoy!
Graduating college and earning my degree was monumental for me. As a first generation college student, passing up the opportunity for higher education was always out of the question for me. I knew I was going to attend college and I knew I was going to graduate with flying colors.
When I did graduate, I enjoyed the day with all my friends and family and cherished the moment in my success. After that passed however, reality started to settle in and I realized the important milestone I reached came with a price to the tune of $31,000. That’s how much debt I was in after college. Just under $21,000 of that debt was student loans.
When I landed my first job out of college, I decided that I wanted my debt gone ASAP. I wanted to live a life that didn’t involve me paying for the things I did or the choices I made years ago.
I Decided to Avoid Lifestyle Inflation
Lots of recent college grads are introduced to lifestyle inflation and temped to spend more. Lifestyle inflation is basically increasing your spending as your income increases or your financial situation improves.
For example, if you get a raise, a higher paying job, or graduate college and land your first job, you may have thoughts about all the things you can do with you money that you couldn’t do before. It can be very tempting to run out and treat yourself one too many times, buy a new car, upgrade your living situation, etc.
If you value things and temporary, instant gratification, you may not have a problem with lifestyle inflation. Waiting to treat yourself to certain things isn’t always fun, but I decided to avoid lifestyle inflation for the time being in order to get rid of my debt quicker.
My debt always seems like it’s holding me back and I know I can’t get to the place in life that I truly want to be at with it dragging behind me.
I’m currently avoiding lifestyle inflation to pay off my debt in several ways.
Cheap Housing
When I landed my first professional job out of college, I stayed in my current apartment in my college town for as long as I could and enjoyed the cheap rent. Moving back with my parents wasn’t an option for me, but if I could’ve done it comfortably, I probably would have.
After about a year of working at my job, I ended up getting an apartment closer to where I work to reduce my commute. Yet and still, I found something reasonable and only about $200 more than what I was paying at my college-town apartment.
Sure, I could get a townhouse, condo, or larger living space with walk-in closets, extra amenities and other features, but I can also put the money I save on housing by staying in my current apartment directly toward my debt.
Used Clothes
I’ve always loved fashion, and purchasing clothes has always been a guilty pleasure of mine. When I started avoiding lifestyle inflation to free up more money to pay off my debt, I went cold turkey on shopping for clothes and started making due with what I had.
This wasn’t a huge sacrifice since I had a decent amount of clothes to wear all year-round, but when something became unwearable, it ended up being a bit of a struggle. Nevertheless, I lasted about 9 months without buying any new clothing.
As a mom, I’m also responsible for clothing my young son but I stuck to second-hand clothes and hand-me-downs when he needed anything new and young kids certainly don’t mind what they wear.
Less Paid Entertainment
As a young person, I found it hard to cut back on my entertainment spending at first and tell my friends ‘no’ when they wanted to do something that was out of my budget. I knew that by saying no to certain opportunities, I would be saying yes to myself and my goal of becoming debt free.
I also believe that life is too short and should be enjoyed, so I didn’t want to have an absolutely dull social life either. Then, I discovered how wonderful free entertainment could be. I started looking online for free events and festivals in my neighborhood and inviting friends over for game nights.
I am always on-the-go with my son during the weekends and I never spend much money at all. We visit the library, go to the park, check out free museums and zoos and visit with friends. For date night with my fiancé, I found a historical theatre that plays classic movies for $1 each week. I still utilize paid entertainment and dine out occasionally, but I stick to my budget and use sites like Group and Living Social to lower the costs of activities.
I’ve secured raises at my job, but I’ve never made a ton of money overall (less than $40k). This means avoiding lifestyle inflation has been a crucial factor when it comes to paying down large amounts of my debt.
How about you all? How do you cope with lifestyle inflation?
Share your experiences by commenting below!
***Photo courtesy of https://www.flickr.com/photos/86530412@N02/8231671430
