May 19, 2026 • 22 mins
What happens when your income goes up, but your peace does not? In this episode, Laura breaks down the sneaky problem of lifestyle inflation—the way raises, extra income, and increased earning power quietly get absorbed into a more expensive version of everyday life. More groceries, more eating out, more shopping, more conveniences, more activities… and somehow still no margin.
Laura shares how lifestyle inflation shows up slowly, why Americans struggle to leave empty space in both their homes and their budgets, and how “just a few little upgrades” can quickly become a whole lifestyle that is hard to sustain. She also shares real-life coaching stories, practical examples, and the mindset shift needed to stop automatically upgrading and start building margin on purpose.
In this episode, you’ll learn:
- Why lifestyle inflation is so easy to miss while it’s happening
- How raises get absorbed into groceries, eating out, shopping, and conveniences
- Why going up in lifestyle feels easy, but cutting back feels painful
- Where lifestyle inflation shows up most in everyday family life
- Why more income should increase your savings and patience, not just your spending
Listener Note
Laura also mentions a short listener survey in this episode. It takes about two minutes, and when you fill it out and leave your name and email, you’ll be entered to win a $50 gift card. Click this link.
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. Join the Facebook group Legacy Builders Network.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Laura (00:00):
What happens when your income goes up but your peace
does not?
That's the problem withlifestyle inflation.
It rarely shows up all at once.
It shows up little by little, anicer grocery bill, more
conveniences, another activityfor the kids, a little more
eating out, a little moreshopping, slightly better
version of normal.
And before you know it, theraise is gone, the margin is
(00:23):
gone, and you're still wonderingwhy money feels so tight.
You are listening to the Moneyand Legacy Podcast with Laura
Sexton.
I'm helping families pay offdebt, grow wealth, and build a
legacy without sacrificing whatmatters most.
This is where money feels easy.
Hey, legacy builders.
(00:43):
Welcome back to the podcast.
Today, we are talking aboutlifestyle inflation, and this is
one sneaky little thing becausemost people do not realize it's
happening while it's happening.
Also, before we jump in, thankyou for being here.
We have had a lot of newlisteners lately, and I wanna
make sure that I'm makingepisodes that actually help you
(01:04):
the most.
So I put together a super shortlistener survey.
It takes about two minutes, andwhen you fill it out and leave
your name and email, you will beentered to win a$50 gift card.
The link is in the show notes,and I would really love your
feedback.
Let's talk about why money stilldoesn't always feel like enough.
Lifestyle inflation.
(01:24):
It's going to happen slowly, andit's usually not one giant
reckless decisions, but rather abunch of small upgrades that
slowly become normal.
Think about it.
When you go to the grocerystore, you have a little bit
more money that you put intothat category.
Or even worse, you go to thegrocery store and you follow
(01:47):
your plan, your shopping list,and then you're like,"Well, I
made a little bit extra today,so I can go ahead and we can
throw a couple extra things inthe cart." Or instead of buying
the steak we usually buy, let'sbuy the more expensive version
'cause it's gonna taste better.
So we've been to the grocerystore, but you know what?
(02:07):
I'm feeling a craving for goingout to eat, and we make a little
bit more money now, so we canput a little bit of extra money
into the going out to eat.
And while we're here, not onlyam I going to get the extra
guacamole to go with my food,but I'm going to get a third
margarita.
How about that?
And you know what?
We make a little bit more money,so now that we have gone to the
(02:29):
grocery store, so we had food athome, but we really wanted to go
out to eat to celebrate the factthat we're making a little bit
more money now.
And, I've had a couplemargaritas, so why don't we go
shopping, right?
Like, let's go to Target, andlet's go see what we can find.
Oh, let's throw some dessert inthe cart, and let's...
Oh, I think, this littleconvenience over here is gonna
be great for us.
(02:49):
Let's go ahead and put that inthe cart.
Do you see what's happening?
What we said in the beginningwas we make a little bit more
money, so we bought moregroceries.
We got extra while we wereeating out, and we did more
shopping.
Now, you may have had a littlebit more money from your
paycheck, but if you spend alittle bit more in all of the
(03:09):
different categories, yourlittle bit more money is now
completely gone.
And for what?
A few more conveniences?
When you're adding, a couplemore activities or a couple more
going out to eat, your raise isgetting absorbed instead of
creating margin, and margin iswhat ultimately we want.
We want to be able to make theselittle bit more decisions, but
(03:31):
you have to make themintentionally.
And if you're not careful,lifestyle inflation becomes a
lifestyle, and that's not whatwe want to have.
We need to, in these instances,plan ahead.
What are we gonna do with themoney when it comes in?
How are we planning to spend it?
How much of the extra are wegoing to put towards saving,
(03:52):
towards future us, instead ofjust consuming all of it?
We, as Americans, do not likeempty space.
A lot of people treat an extramoney like it has to be used
immediately instead ofprotected.
So think of it like this (04:06):
think of a room in your house that has
shelves in it.
Do you have any empty shelfspace?
Probably not, because if thereis room on the shelf, we f- feel
the need to fill it, and ifthere's room in the budget, we
feel like we need to fill that,too.
(04:27):
Empty feels like lack.
And for whatever reason, theAmerican psyche says if you're
lacking something, you have tofill that with something.
If there is emptiness, it feelslike there's something wrong,
and so we have this strongdesire to fill it.
(04:49):
And I would like to give youpermission, if you have empty
spaces on your shelves, to leaveit that way.
And if you don't have emptyspace on your shelf and you
wanna see what this feels like,and you wanna try out this
emotional experiment with me,why don't you go take some stuff
off the shelf, box it up, andput it in the garage or put it
(05:10):
somewhere where you can't seeit, and I want you to see how
quickly you fill that space up.
I'm about to do this on a verybig scale.
We are going from 900 squarefeet to 2,700 square feet, and
so there's going to be a lot ofempty space because we don't
have the things that are neededto fill up that amount of space.
I am happy that we are going tohave a limited budget for the
(05:35):
first year where things aregoing to be tighter so that I am
not tempted to immediately gofill the space.
Extra money starts to feel likepermission to spend instead of
an opportunity to expand.
What I am going through on avisceral level right now is
(05:56):
learning to live in the emptyspace, learning to be okay with
it.
I'm trying to teach this to mykids.
When they have a empty space intheir things to do, they wanna
fill it up with television, orthey want mom to come give them
something to do, and it's theempty space where creativity
lives.
(06:16):
When you have room to breathe,you have room to be creative.
Sometimes with our finances, weneed to get creative.
Let me explain to you that Uberand Lyft, those conveniences,
Instacart, these conveniencesthat a lot of us spend our money
on, those things would not existwere there not a gap in the
(06:37):
market, were there not somespace for somebody to be
creative and come up with acreative way to fill that need.
I've heard it said many timesthat necessity is the mother of
all invention.
with our kids, when they'rebored, and they should be bored
more often, they will create agame.
(06:58):
They will come up with an idea.
They will get creative and makesomething with their hands.
They need the space to do that,though.
And we as adults are exactly thesame.
We need the space to becreative.
We need the space, but we don'tgive ourselves that permission.
And when it comes to our money,the margin sometimes feels
(07:21):
uncomfortable because we're notused to there being a gap.
We're not very good at leavingthe margin empty.
But if you go back to firstgrade English class, those
margins are supposed to beempty.
You're not supposed to write inthem.
Going up in lifestyle feelsreally easy, but going backwards
(07:45):
feels very painful.
Once an upgrade becomes normal,cutting back feels like a loss.
Sometimes it's like this withmoney we haven't actually
earned.
You think you're gonna get araise, and so you start spending
the money, like Christmasvacation, where they start
spending all the money.
They break ground on the pool.
They decide they're gonna buildout this whole pool, and instead
(08:05):
of a bonus, he gets the Jelly ofthe Month Club We feel like
we've lost something becausewe've already spent the money in
our mind.
If your boss says,"Hey, I'mgonna give you a raise.
Come into my office later todayand we're gonna talk about it,"
and you're thinking,"He's gonnagive me$100,000.
I'm gonna get this bonus andit's gonna be amazing." And you
get there and it's like,"Here's20 bucks.
(08:27):
Thanks so much for the workyou've been doing." You didn't
need the$100,000 and you didn'tneed the$20, but in the time
between, you started spendingall this money, and then you're
gonna feel like he slighted youbecause you make it up in your
mind, and you start spending itin your mind.
And so anything feels like aloss.
(08:48):
The same is with your finances.
I can't tell you the number ofclients that I have that come to
me and they have all of thesenice, lavish, expensive things,
and we have to downgrade.
And they feel like they're justreally losing.
I can't...
(09:08):
I can't go back.
I can't go from my$50,000 car toa$20,000 car, because then what
will people think of me?
I can't go from that becausethen it won't be as safe." Let
me tell you, your$50,000 carafter three years of driving it
around is just as safe as athree-year-old Honda.
The features may be a little bitless, but you're still safe.
(09:33):
But you feel like you've lostsomething.
You've lost some sort of status.
You've lost some sort ofprestige.
An upgrade is going to feelharmless at first.
But then they become expected.
And when it's expected, thenit's a necessity.
(09:56):
And when I'm writing out mybudget, it's a necessity on my
budget, so it has to go at thetop of the list and other things
can fall down to the bottom.
And then you reach a place wheresimplifying your life feels like
punishment.
I don't want...
I don't wanna punish you.
I don't want you to feelpunished.
But you have to realize, thatpeople adapt fast to a more
(10:19):
expensive version of life, butgoing backwards is very
difficult.
So if you want these things inyour life, you need to set
yourself up for it.
What you don't wanna do is getinto a position where you're
making payments on everythingbecause you couldn't tell
yourself or your children nobecause going backwards feels
painful.
And if I have to tell my kids nowhen they think it's a necessity
(10:43):
because they've started toexpect the increase, and now I'm
having to tell them no, it feelslike I'm hurting them.
But you're not.
You are making decisions thatare best for them.
It's like the other day when wehad to go get stitches and my
three-year-old was freaking out,obviously, because it's painful
(11:04):
and it was hard for me and itwas hard for her and the whole
thing was terrible.
But we had to give her a shot tonumb the area so we could do the
stitches.
And it's incredibly painful, andshe didn't want to do it.
But I knew as the parent that alittle bit of pain now would
make it feel easier later.
(11:28):
It is the same for you and yourmoney, my friend.
So if it can be a little bitdifficult right now, and we can
save up money and we can buy thething in cash, whatever the
thing is, it keeps it from beingpainful in the future.
And by allowing that space, thatmargin, that time to breathe
between deciding I want thepurchase and saving up for the
(11:50):
purchase, we are keepingourselves from massive lifestyle
inflation.
We are keeping ourselves fromimpulsivity.
We are keeping ourselves fromthese things becoming
necessities.
They are not.
It's all a choice that we arechoosing to make.
So let's talk about wherelifestyle inflation shows up
most, because I've talked abouta couple things here, but I feel
(12:10):
like in daily life it oftenshows up in small categories
before people even notice thebigger problem.
For us right now, it's kidsactivities.
We are entering into the summerseason, and do you know what
that means?
Summer camps.
That means extra activities.
It means they're going to behome all day and needing
somebody to entertain them, andit's certainly not going to be
able to be me.
(12:31):
I can't entertain five people,keep all of them fed, keep the
house clean, keep my businessrunning, keep myself taken care
of all the time.
They're gonna have to have somemargin.
They're gonna have to have someactivities for themselves, and
they're gonna have to have someindividuality.
They're going to have to makesome of their own decisions.
The ones that are old enough todo that, obviously.
(12:51):
But we've been talking a lotabout what does camp look like,
what kind of activities do wewanna put them in, and it is not
the easiest thing in the worldto come up with all of these
ideas.
We sat down and we talked aboutour oldest just bought a guitar.
She saved up money, and she wonit in a school auction, which
(13:14):
was fabulous.
I'm so excited for her becauseit was about a quarter of the
price that she was planning onspending.
And she took the money to schooland she had to pay for it, and
she had to count it out, and itwas amazing.
I'm so proud of her for savingup her money, first of all.
But one of the things that wewanna do, we told her if she
bought the guitar, we would payfor guitar lessons.
So guess what we're gonna bedoing this summer?
We are putting her in guitarlessons, but then also there's
(13:36):
Girl Scout camp that she wantsto do.
We wanna put the kids intoswimming class because we wanna
make sure that they're safewhile they're swimming, and we-
saying yes and yes and yes andyes and yes, that's money that
adds up that I don't necessarilyhave.
Let's talk about clothes.
Lifestyle inflation will...
(13:56):
As you are trying to...
And this especially comes up alot for teenagers,"I wanna look
like my friends.
I wanna fit in.
I have to buy the newesttrends." Trust me, I am moving
to a new state and I have growna size or two since having five
children, and I'm having to buyclothes and I wanna buy the nice
(14:19):
ones.
I don't wanna buy stuff thatdoesn't look good.
I wanna buy stuff that lookslike I fit in.
I wanna buy stuff that looksnice.
I wanna look good for myhusband.
But what I don't want to do isspend a ton of money on clothes
that look good today and thenare out of fashion tomorrow.
You have to be smart.
Do I need some fashionablepieces that fit with the trend?
(14:40):
Yes.
Do I need all of them?
No.
Most of them need to be staplesthat I can weave in and out.
Same with any kind of shopping.
We have to be very considerateof what it is that we're buying.
One of the things I really wantto do for my new house is I
wanna be able to decorate forall of the seasons.
I don't need a welcome mat forevery different season, but
(15:04):
Target sells them.
There's one for Fourth of July.
There's one for Valentine's Day.
There's one for Christmas.
You don't need all the differentthings for all of the different
things.
But you want them.
I want them.
That's how I know.
Groceries.
This is a big place forlifestyle inflation to show up.
Man, it is so easy to just gobuy more and more and more and
(15:25):
more and more and then never usethem.
I'm in the process of trying touse everything in my pantry
before we move and, there's somuch stuff in this pantry that I
never use, that I thought,"Oh,for sure I'm gonna do this one
recipe," and I never got aroundto it.
It's wasteful.
It's crazy.
(15:45):
Eating out.
This is a small category wherepeople don't even pay attention,
and sometimes it's me.
I've been better at this, butsometimes I forget that we've
already gone out to eat duringthis pay period even though I
balanced the budget.
I have completely forgotten thatduring this paycheck we've
already gone out to eat andwe've already spent the money
and so I'm gonna go out again.
Little conveniences,subscriptions, beauty, and other
(16:08):
lifestyle areas.
Let's look at housing when itcomes to lifestyle inflation.
I'm willing to bet you largeamounts of money that you're not
going onto Zillow looking for asmaller, cheaper, simpler house.
Nine times out of 10, when yougo browse on Zillow, you are
looking for something bigger.
You are looking for more squarefootage.
(16:29):
You are looking for morebedrooms.
You are looking for morebathrooms.
You're looking for a biggerbackyard.
People browse up.
You're not browsing down.
So here is a real-life exampleof how incredibly bad that this
can get.
I need you to know that highincome does not protect people
(16:49):
from lifestyle inflation.
In fact, what it does usually isit hides it.
I had clients that made$35,000per month, not per year.
They made$35,000 per month, andthey were still broke.
Every want that they saw becamea payment because,"Well, I can
(17:10):
afford the payments." That wasuntil they couldn't.
Cars, purses, houses, upgrades,kids, lifestyle.
There was no margin foremergencies, so any emergency
that came up went on a creditcard.
One unexpected anything, anotherpayment plan.
(17:34):
It got to the point where theydecided they couldn't keep
living where they were living,so they needed to move out of
their state and move to adifferent one.
He got another job.
He was retiring from themilitary, so he was gonna have
his military pension and hisincome from his new job.
She was working two jobs, andthey were doing all this just to
cover their payments becausethey had all four incomes.
(17:57):
They moved out of their housethat was too much money for them
that they could not afford, andthey moved into a bigger house
with a bigger payment.
And they said,"Well, I assumebecause we're bringing in the
pension and I have my new jobnow, we should be able to cover
it." That's when we had tochoose to part ways because the
(18:22):
decisions they were making werenot leading them towards paying
off their cars, paying off theircredit cards.
When I'm working with somebodyand we start with 35 lines of
credit, and over the course ofsix months we jump up to 42
lines of credit, we are goingthe wrong way And I only wanna
(18:44):
work with you if you are willingto put in the work and make the
changes.
Now, I love this couple, and Iwould jump back into helping
them in a heartbeat if theychose to change the way they are
doing things, but if they aregoing to continue,$35,000 a
month, and they are still broke.
A$100 repair a new tire or abroken window or anything like
(19:10):
that, they needed to cover$100,they would have to put it on
credit because they do not havethe ability to make all of their
payments and still have any kindof margin.
That's why I get really, reallyanimated about this lifestyle
increase situation, because whenincome increases, the answer is
not automatic upgrades.
(19:30):
The answer is intentionality.
Stop automatically assuming thatyou can do more and choose to
pause.
Pause when you find out thatyour income's going to go up,
because I want you to directyour increases towards the
future first.
We need to build margin intoyour lifestyle.
That starts by asking yourselfwhat actually matters.
(19:54):
When your spending does notalign with your values,
sometimes we don't see itbecause we're just in the
day-to-day.
We're just trying to keep ourhead above water.
Right now in the move, I'm justtrying to keep my head above
water.
I'm just trying to do the bareminimum to keep the house going
while also packing, also caringfor five children, also caring
(20:15):
for myself, making sure myhusband and all of his stuff's
taken care of.
We're gearing up for retirement.
We're going to have multipleballs in the air as we move
across the country.
It's so much, and all I can dois keep my head above water, and
sometimes I make spendingdecisions that don't align with
my values.
So I'm having to, in thisseason, pause longer before I
(20:36):
make any spending decisions.
For you, I want to reiteratethat what you should be
increasing is your savings andyour patience, not your
lifestyle.
So here's the question that Iwant to leave you with this
week (20:52):
Where is lifestyle inflation already happening in
your life?
What categories keep creeping uplittle by little, month after
month?
If my income's gone up, has mypeace stayed the same?
(21:13):
Am I building margin or just aprettier version of stress?
I don't want you to be stressedout.
I want you to have peace in yourlife.
Your peace should be increasingmore and more and more than your
income.
Now, this is exactly the type ofthing that we sort through on a
clarity call, which is a freecall where you and I can sit
(21:34):
down and look at what's going onwith your numbers.
I wanna help you get clarity onyour next right financial steps.
And if there's a way that I cansupport you further, we can talk
about that.
But either way, you're gonnawalk away with more clarity than
you came in with.
All you have to do to book thatclarity call is go to
accelerateyourlegacy.com/claritycallor scroll down in the show notes
(21:55):
and click on Clarity Call.
You're going to click on the AreYou Ready To Master Your Money
question.
That's the one.
I want you to become a master ofyour money.
More income should give youbreathing room, not just a more
expensive version of yournormal.
So go out and assess what'sreally going on with your
(22:17):
spending and going on insideyour mind, going on inside your
heart.
And this week, my legacybuilders, I encourage you to go
out and make a difference
What happens when your income goes up but your peace
does not?
That's the problem withlifestyle inflation.
It rarely shows up all at once.
It shows up little by little, anicer grocery bill, more
conveniences, another activityfor the kids, a little more
eating out, a little moreshopping, slightly better
version of normal.
And before you know it, theraise is gone, the margin is
(00:23):
gone, and you're still wonderingwhy money feels so tight.
You are listening to the Moneyand Legacy Podcast with Laura
Sexton.
I'm helping families pay offdebt, grow wealth, and build a
legacy without sacrificing whatmatters most.
This is where money feels easy.
Hey, legacy builders.
(00:43):
Welcome back to the podcast.
Today, we are talking aboutlifestyle inflation, and this is
one sneaky little thing becausemost people do not realize it's
happening while it's happening.
Also, before we jump in, thankyou for being here.
We have had a lot of newlisteners lately, and I wanna
make sure that I'm makingepisodes that actually help you
(01:04):
the most.
So I put together a super shortlistener survey.
It takes about two minutes, andwhen you fill it out and leave
your name and email, you will beentered to win a$50 gift card.
The link is in the show notes,and I would really love your
feedback.
Let's talk about why money stilldoesn't always feel like enough.
Lifestyle inflation.
(01:24):
It's going to happen slowly, andit's usually not one giant
reckless decisions, but rather abunch of small upgrades that
slowly become normal.
Think about it.
When you go to the grocerystore, you have a little bit
more money that you put intothat category.
Or even worse, you go to thegrocery store and you follow
(01:47):
your plan, your shopping list,and then you're like,"Well, I
made a little bit extra today,so I can go ahead and we can
throw a couple extra things inthe cart." Or instead of buying
the steak we usually buy, let'sbuy the more expensive version
'cause it's gonna taste better.
So we've been to the grocerystore, but you know what?
(02:07):
I'm feeling a craving for goingout to eat, and we make a little
bit more money now, so we canput a little bit of extra money
into the going out to eat.
And while we're here, not onlyam I going to get the extra
guacamole to go with my food,but I'm going to get a third
margarita.
How about that?
And you know what?
We make a little bit more money,so now that we have gone to the
(02:29):
grocery store, so we had food athome, but we really wanted to go
out to eat to celebrate the factthat we're making a little bit
more money now.
And, I've had a couplemargaritas, so why don't we go
shopping, right?
Like, let's go to Target, andlet's go see what we can find.
Oh, let's throw some dessert inthe cart, and let's...
Oh, I think, this littleconvenience over here is gonna
be great for us.
(02:49):
Let's go ahead and put that inthe cart.
Do you see what's happening?
What we said in the beginningwas we make a little bit more
money, so we bought moregroceries.
We got extra while we wereeating out, and we did more
shopping.
Now, you may have had a littlebit more money from your
paycheck, but if you spend alittle bit more in all of the
(03:09):
different categories, yourlittle bit more money is now
completely gone.
And for what?
A few more conveniences?
When you're adding, a couplemore activities or a couple more
going out to eat, your raise isgetting absorbed instead of
creating margin, and margin iswhat ultimately we want.
We want to be able to make theselittle bit more decisions, but
(03:31):
you have to make themintentionally.
And if you're not careful,lifestyle inflation becomes a
lifestyle, and that's not whatwe want to have.
We need to, in these instances,plan ahead.
What are we gonna do with themoney when it comes in?
How are we planning to spend it?
How much of the extra are wegoing to put towards saving,
(03:52):
towards future us, instead ofjust consuming all of it?
We, as Americans, do not likeempty space.
A lot of people treat an extramoney like it has to be used
immediately instead ofprotected.
So think of it like this (04:06):
think of a room in your house that has
shelves in it.
Do you have any empty shelfspace?
Probably not, because if thereis room on the shelf, we f- feel
the need to fill it, and ifthere's room in the budget, we
feel like we need to fill that,too.
(04:27):
Empty feels like lack.
And for whatever reason, theAmerican psyche says if you're
lacking something, you have tofill that with something.
If there is emptiness, it feelslike there's something wrong,
and so we have this strongdesire to fill it.
(04:49):
And I would like to give youpermission, if you have empty
spaces on your shelves, to leaveit that way.
And if you don't have emptyspace on your shelf and you
wanna see what this feels like,and you wanna try out this
emotional experiment with me,why don't you go take some stuff
off the shelf, box it up, andput it in the garage or put it
(05:10):
somewhere where you can't seeit, and I want you to see how
quickly you fill that space up.
I'm about to do this on a verybig scale.
We are going from 900 squarefeet to 2,700 square feet, and
so there's going to be a lot ofempty space because we don't
have the things that are neededto fill up that amount of space.
I am happy that we are going tohave a limited budget for the
(05:35):
first year where things aregoing to be tighter so that I am
not tempted to immediately gofill the space.
Extra money starts to feel likepermission to spend instead of
an opportunity to expand.
What I am going through on avisceral level right now is
(05:56):
learning to live in the emptyspace, learning to be okay with
it.
I'm trying to teach this to mykids.
When they have a empty space intheir things to do, they wanna
fill it up with television, orthey want mom to come give them
something to do, and it's theempty space where creativity
lives.
(06:16):
When you have room to breathe,you have room to be creative.
Sometimes with our finances, weneed to get creative.
Let me explain to you that Uberand Lyft, those conveniences,
Instacart, these conveniencesthat a lot of us spend our money
on, those things would not existwere there not a gap in the
(06:37):
market, were there not somespace for somebody to be
creative and come up with acreative way to fill that need.
I've heard it said many timesthat necessity is the mother of
all invention.
with our kids, when they'rebored, and they should be bored
more often, they will create agame.
(06:58):
They will come up with an idea.
They will get creative and makesomething with their hands.
They need the space to do that,though.
And we as adults are exactly thesame.
We need the space to becreative.
We need the space, but we don'tgive ourselves that permission.
And when it comes to our money,the margin sometimes feels
(07:21):
uncomfortable because we're notused to there being a gap.
We're not very good at leavingthe margin empty.
But if you go back to firstgrade English class, those
margins are supposed to beempty.
You're not supposed to write inthem.
Going up in lifestyle feelsreally easy, but going backwards
(07:45):
feels very painful.
Once an upgrade becomes normal,cutting back feels like a loss.
Sometimes it's like this withmoney we haven't actually
earned.
You think you're gonna get araise, and so you start spending
the money, like Christmasvacation, where they start
spending all the money.
They break ground on the pool.
They decide they're gonna buildout this whole pool, and instead
(08:05):
of a bonus, he gets the Jelly ofthe Month Club We feel like
we've lost something becausewe've already spent the money in
our mind.
If your boss says,"Hey, I'mgonna give you a raise.
Come into my office later todayand we're gonna talk about it,"
and you're thinking,"He's gonnagive me$100,000.
I'm gonna get this bonus andit's gonna be amazing." And you
get there and it's like,"Here's20 bucks.
(08:27):
Thanks so much for the workyou've been doing." You didn't
need the$100,000 and you didn'tneed the$20, but in the time
between, you started spendingall this money, and then you're
gonna feel like he slighted youbecause you make it up in your
mind, and you start spending itin your mind.
And so anything feels like aloss.
(08:48):
The same is with your finances.
I can't tell you the number ofclients that I have that come to
me and they have all of thesenice, lavish, expensive things,
and we have to downgrade.
And they feel like they're justreally losing.
I can't...
(09:08):
I can't go back.
I can't go from my$50,000 car toa$20,000 car, because then what
will people think of me?
I can't go from that becausethen it won't be as safe." Let
me tell you, your$50,000 carafter three years of driving it
around is just as safe as athree-year-old Honda.
The features may be a little bitless, but you're still safe.
(09:33):
But you feel like you've lostsomething.
You've lost some sort of status.
You've lost some sort ofprestige.
An upgrade is going to feelharmless at first.
But then they become expected.
And when it's expected, thenit's a necessity.
(09:56):
And when I'm writing out mybudget, it's a necessity on my
budget, so it has to go at thetop of the list and other things
can fall down to the bottom.
And then you reach a place wheresimplifying your life feels like
punishment.
I don't want...
I don't wanna punish you.
I don't want you to feelpunished.
But you have to realize, thatpeople adapt fast to a more
(10:19):
expensive version of life, butgoing backwards is very
difficult.
So if you want these things inyour life, you need to set
yourself up for it.
What you don't wanna do is getinto a position where you're
making payments on everythingbecause you couldn't tell
yourself or your children nobecause going backwards feels
painful.
And if I have to tell my kids nowhen they think it's a necessity
(10:43):
because they've started toexpect the increase, and now I'm
having to tell them no, it feelslike I'm hurting them.
But you're not.
You are making decisions thatare best for them.
It's like the other day when wehad to go get stitches and my
three-year-old was freaking out,obviously, because it's painful
(11:04):
and it was hard for me and itwas hard for her and the whole
thing was terrible.
But we had to give her a shot tonumb the area so we could do the
stitches.
And it's incredibly painful, andshe didn't want to do it.
But I knew as the parent that alittle bit of pain now would
make it feel easier later.
(11:28):
It is the same for you and yourmoney, my friend.
So if it can be a little bitdifficult right now, and we can
save up money and we can buy thething in cash, whatever the
thing is, it keeps it from beingpainful in the future.
And by allowing that space, thatmargin, that time to breathe
between deciding I want thepurchase and saving up for the
(11:50):
purchase, we are keepingourselves from massive lifestyle
inflation.
We are keeping ourselves fromimpulsivity.
We are keeping ourselves fromthese things becoming
necessities.
They are not.
It's all a choice that we arechoosing to make.
So let's talk about wherelifestyle inflation shows up
most, because I've talked abouta couple things here, but I feel
(12:10):
like in daily life it oftenshows up in small categories
before people even notice thebigger problem.
For us right now, it's kidsactivities.
We are entering into the summerseason, and do you know what
that means?
Summer camps.
That means extra activities.
It means they're going to behome all day and needing
somebody to entertain them, andit's certainly not going to be
able to be me.
(12:31):
I can't entertain five people,keep all of them fed, keep the
house clean, keep my businessrunning, keep myself taken care
of all the time.
They're gonna have to have somemargin.
They're gonna have to have someactivities for themselves, and
they're gonna have to have someindividuality.
They're going to have to makesome of their own decisions.
The ones that are old enough todo that, obviously.
(12:51):
But we've been talking a lotabout what does camp look like,
what kind of activities do wewanna put them in, and it is not
the easiest thing in the worldto come up with all of these
ideas.
We sat down and we talked aboutour oldest just bought a guitar.
She saved up money, and she wonit in a school auction, which
(13:14):
was fabulous.
I'm so excited for her becauseit was about a quarter of the
price that she was planning onspending.
And she took the money to schooland she had to pay for it, and
she had to count it out, and itwas amazing.
I'm so proud of her for savingup her money, first of all.
But one of the things that wewanna do, we told her if she
bought the guitar, we would payfor guitar lessons.
So guess what we're gonna bedoing this summer?
We are putting her in guitarlessons, but then also there's
(13:36):
Girl Scout camp that she wantsto do.
We wanna put the kids intoswimming class because we wanna
make sure that they're safewhile they're swimming, and we-
saying yes and yes and yes andyes and yes, that's money that
adds up that I don't necessarilyhave.
Let's talk about clothes.
Lifestyle inflation will...
(13:56):
As you are trying to...
And this especially comes up alot for teenagers,"I wanna look
like my friends.
I wanna fit in.
I have to buy the newesttrends." Trust me, I am moving
to a new state and I have growna size or two since having five
children, and I'm having to buyclothes and I wanna buy the nice
(14:19):
ones.
I don't wanna buy stuff thatdoesn't look good.
I wanna buy stuff that lookslike I fit in.
I wanna buy stuff that looksnice.
I wanna look good for myhusband.
But what I don't want to do isspend a ton of money on clothes
that look good today and thenare out of fashion tomorrow.
You have to be smart.
Do I need some fashionablepieces that fit with the trend?
(14:40):
Yes.
Do I need all of them?
No.
Most of them need to be staplesthat I can weave in and out.
Same with any kind of shopping.
We have to be very considerateof what it is that we're buying.
One of the things I really wantto do for my new house is I
wanna be able to decorate forall of the seasons.
I don't need a welcome mat forevery different season, but
(15:04):
Target sells them.
There's one for Fourth of July.
There's one for Valentine's Day.
There's one for Christmas.
You don't need all the differentthings for all of the different
things.
But you want them.
I want them.
That's how I know.
Groceries.
This is a big place forlifestyle inflation to show up.
Man, it is so easy to just gobuy more and more and more and
(15:25):
more and more and then never usethem.
I'm in the process of trying touse everything in my pantry
before we move and, there's somuch stuff in this pantry that I
never use, that I thought,"Oh,for sure I'm gonna do this one
recipe," and I never got aroundto it.
It's wasteful.
It's crazy.
(15:45):
Eating out.
This is a small category wherepeople don't even pay attention,
and sometimes it's me.
I've been better at this, butsometimes I forget that we've
already gone out to eat duringthis pay period even though I
balanced the budget.
I have completely forgotten thatduring this paycheck we've
already gone out to eat andwe've already spent the money
and so I'm gonna go out again.
Little conveniences,subscriptions, beauty, and other
(16:08):
lifestyle areas.
Let's look at housing when itcomes to lifestyle inflation.
I'm willing to bet you largeamounts of money that you're not
going onto Zillow looking for asmaller, cheaper, simpler house.
Nine times out of 10, when yougo browse on Zillow, you are
looking for something bigger.
You are looking for more squarefootage.
(16:29):
You are looking for morebedrooms.
You are looking for morebathrooms.
You're looking for a biggerbackyard.
People browse up.
You're not browsing down.
So here is a real-life exampleof how incredibly bad that this
can get.
I need you to know that highincome does not protect people
(16:49):
from lifestyle inflation.
In fact, what it does usually isit hides it.
I had clients that made$35,000per month, not per year.
They made$35,000 per month, andthey were still broke.
Every want that they saw becamea payment because,"Well, I can
(17:10):
afford the payments." That wasuntil they couldn't.
Cars, purses, houses, upgrades,kids, lifestyle.
There was no margin foremergencies, so any emergency
that came up went on a creditcard.
One unexpected anything, anotherpayment plan.
(17:34):
It got to the point where theydecided they couldn't keep
living where they were living,so they needed to move out of
their state and move to adifferent one.
He got another job.
He was retiring from themilitary, so he was gonna have
his military pension and hisincome from his new job.
She was working two jobs, andthey were doing all this just to
cover their payments becausethey had all four incomes.
(17:57):
They moved out of their housethat was too much money for them
that they could not afford, andthey moved into a bigger house
with a bigger payment.
And they said,"Well, I assumebecause we're bringing in the
pension and I have my new jobnow, we should be able to cover
it." That's when we had tochoose to part ways because the
(18:22):
decisions they were making werenot leading them towards paying
off their cars, paying off theircredit cards.
When I'm working with somebodyand we start with 35 lines of
credit, and over the course ofsix months we jump up to 42
lines of credit, we are goingthe wrong way And I only wanna
(18:44):
work with you if you are willingto put in the work and make the
changes.
Now, I love this couple, and Iwould jump back into helping
them in a heartbeat if theychose to change the way they are
doing things, but if they aregoing to continue,$35,000 a
month, and they are still broke.
A$100 repair a new tire or abroken window or anything like
(19:10):
that, they needed to cover$100,they would have to put it on
credit because they do not havethe ability to make all of their
payments and still have any kindof margin.
That's why I get really, reallyanimated about this lifestyle
increase situation, because whenincome increases, the answer is
not automatic upgrades.
(19:30):
The answer is intentionality.
Stop automatically assuming thatyou can do more and choose to
pause.
Pause when you find out thatyour income's going to go up,
because I want you to directyour increases towards the
future first.
We need to build margin intoyour lifestyle.
That starts by asking yourselfwhat actually matters.
(19:54):
When your spending does notalign with your values,
sometimes we don't see itbecause we're just in the
day-to-day.
We're just trying to keep ourhead above water.
Right now in the move, I'm justtrying to keep my head above
water.
I'm just trying to do the bareminimum to keep the house going
while also packing, also caringfor five children, also caring
(20:15):
for myself, making sure myhusband and all of his stuff's
taken care of.
We're gearing up for retirement.
We're going to have multipleballs in the air as we move
across the country.
It's so much, and all I can dois keep my head above water, and
sometimes I make spendingdecisions that don't align with
my values.
So I'm having to, in thisseason, pause longer before I
(20:36):
make any spending decisions.
For you, I want to reiteratethat what you should be
increasing is your savings andyour patience, not your
lifestyle.
So here's the question that Iwant to leave you with this
week (20:52):
Where is lifestyle inflation already happening in
your life?
What categories keep creeping uplittle by little, month after
month?
If my income's gone up, has mypeace stayed the same?
(21:13):
Am I building margin or just aprettier version of stress?
I don't want you to be stressedout.
I want you to have peace in yourlife.
Your peace should be increasingmore and more and more than your
income.
Now, this is exactly the type ofthing that we sort through on a
clarity call, which is a freecall where you and I can sit
(21:34):
down and look at what's going onwith your numbers.
I wanna help you get clarity onyour next right financial steps.
And if there's a way that I cansupport you further, we can talk
about that.
But either way, you're gonnawalk away with more clarity than
you came in with.
All you have to do to book thatclarity call is go to
accelerateyourlegacy.com/claritycallor scroll down in the show notes
(21:55):
and click on Clarity Call.
You're going to click on the AreYou Ready To Master Your Money
question.
That's the one.
I want you to become a master ofyour money.
More income should give youbreathing room, not just a more
expensive version of yournormal.
So go out and assess what'sreally going on with your
(22:17):
spending and going on insideyour mind, going on inside your
heart.
And this week, my legacybuilders, I encourage you to go
out and make a difference
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