Living Large or Broke? How to Avoid Lifestyle Inflation

Inflation has been going through the roof over the past few years, affecting everyone from all walks of life. With everything becoming more expensive and incomes failing to rise accordingly, certain lifestyle choices are no longer feasible without putting yourself in financial jeopardy.

Fortunately, help in the form of debt consolidation and counselling is at hand. Here are some ways we help our clients manage their financial health: 

Prioritise Essentials

The first step towards curbing lifestyle spending during times of high inflation is to focus on only purchasing necessities for your household. These include things like food, paying for utilities, and funding transportation. 

Any non-essential purchases need to be reviewed and either cut out of the budget entirely, or at the very least, reduced. These could be things like dining out, entertainment, or the purchase of luxury items. 

Think Frugally

Low-cost living requires adopting a frugal mindset. To achieve this, you need to get into the habit of cost-saving activities like cooking at home rather than eating out, buying in bulk, looking for specials and discounts whenever you’re out shopping, or purchasing second-hand goods whenever possible. 

These small changes in your daily spending habits can contribute to significant savings over time.

Delay Big Purchases

If you have large, non-essential purchases on your mind, try to delay them until economic conditions improve. Big purchases could include things like upgrading your car, purchasing expensive electronics, or carrying out renovations to your home, for example. 

Rather than splurging on expensive upgrades now, focus on maintaining what you have until such time as your financial situation improves.

Cancel Extra Subscription Services

Nowadays, it’s easy to rack up a bunch of subscription services that you might use very infrequently or not at all. Weed these out to quickly reduce your monthly bills. These can include subscriptions to multiple streaming services you don’t need, gym memberships you don’t use, or unnecessary magazine subscriptions. 

There are cheaper or even free alternatives to most of these.

If you find yourself sinking under rising inflation, and feel like you are drowning in debt, contact our qualified debt counselling consultants before it is too late. Zero Debt – your partner to financial freedom.

FAQs and Answers

1. What is lifestyle inflation?
   Lifestyle inflation refers to an increase in spending as income rises, often on non-essential items, leading to financial strain.
2. How can I prioritise essential spending?
   Focus on necessities like food, utilities, and transportation. Cut or reduce non-essential purchases like dining out and luxury items.
3. What are some ways to live frugally?
   Adopt cost-saving habits such as cooking at home, buying in bulk, seeking discounts, and purchasing second-hand goods.
4. Should I delay big purchases during inflation?
   Yes, postponing large non-essential expenses like cars or electronics can help maintain financial stability until conditions improve.
5. How can cancelling extra subscriptions save money?
   Eliminate unused subscriptions like streaming services, gym memberships, or magazines to reduce monthly expenses.
6. What is debt consolidation and how can it help?
   Debt consolidation combines multiple debts into a single payment, making it easier to manage repayments and potentially reducing interest rates.
7. How does debt counselling support financial health?
   Debt counselling provides guidance on managing debts, creating budgets, and negotiating with creditors to achieve financial stability.
8. How can Zero Debt help during financial struggles?
   Zero Debt offers debt counselling and consolidation services, providing professional support to manage and overcome financial challenges.