Curator Cat Considers: Earning, Investing and the "Lifestyle Inflation" Issue!
Greetings Felines and Hoomans of LeoFinance and Greater Hivelandia!
Trying to "expand my horizons" a bit by exploring different kinds of content... and since we cats sleep a lot, we also have a lot of time to think about stuff! And if we can have a @scaredycatguide on investing, why not a different cat on money and business?
Striving for More!
Whether we're out in the world, striving to advance ourselves at work; trying to build something with our own businesses or projects; or even here in the cryptosphere, trying to maximize our investment returns or blogging rewards... bottom line is that we're striving for more; for better.
And if we play our cards right and develop some wise strategies, there's a good chance we will end up with more income; more money available to invest.
But Why Aren't I Getting Richer?
There's a tricky — and often disregarded/overlooked — aspect to increasing your income: As more money becomes available to us, we also find ourselves "mysteriously" facing the issue of there being more things we have to spend money on.
And don't misunderstand, here! I'm not suggesting people who start making more income suddenly start throwing non-stop wild parties and traveling to Bora-Bora every other week... it's far more of a creeping thing than that!
We have long "meant to" pay off our credit cards. And we've "been meaning to" do some major repairs on our car. And then there's that roof repair. And it would really be nice to actually have a couple of pairs of new running shoes.
Catching Up, In Order To Get Ahead...
If your increased earnings come at a point in your life where you've "barely been making it" for a long time, there's often a lot of catching up to be done.
And when the "now we can actually AFFORD that" mindset takes root, investing often ends up being the last thing you do. It gets put off; we rationalize that we can "start investing when all this other small stuff is out of the way."
Problem is, if you've been living on "the razor's edge" for a long time, there's a LOT of that small stuff...
Then Comes "Lifestyle Inflation!"
What I am calling "Lifestyle Inflation" can actually take many forms.
The overstated caricature we often toss around here is the image of making money on a lucky crypto gamble and buying a Lambo. But the reality in most people's lives is far subtler, and is something that comes creeping in through the cracks.
During that "catching up" phase I just mentioned, we get accustomed — if not slightly addicted — to being more comfortable in our lives.
In an applied sense, we might go from "making $2,500 and month and SPENDING $2,500 a month" and barely getting by to "making $4,000 a month and SPENDING $4,000 a month."
See the problem? We're still no better off investing than we were before. And VERY few people have the resolve and determination to stick to a "minimalist" lifestyle in order to build an investment portfolio.
Pay Yourself First!
One of the better pieces of investing wisdom I know is the old truism "pay yourself first!"
Ultimately, it's a statement about setting priorities. If your objective is to build that investment portfolio, then you have to make it a priority in your life... otherwise you can end up on the receiving and of the reality that strictly speaking, someone who makes $30,000 a year and spends $25,000 is actually better off than someone who makes $300,000 a year and SPENDS $300,000 a year.
Of course, that depends somewhat on how we define "better off." I'm sure lots of people would argue in favor of their higher and better lifestyle...
BUT that isn't helping build that investment portfolio we started out talking about, and now that you have all those new obligations to pay for... you need a backup cushion more than ever before!
So when you enjoy your crypto success, be mindful that you don't give it right back in the form of Lifestyle Inflation!
Thanks for reading!
Posted Using LeoFinance Beta