Did you get a raise?
Did you get a new job that pays more?
Ooooohhh, now you’re making mooonnaayyyy.
You got that guap. That moolah.
We gonna spend it at the clluuubbb right?
We gonna pop bottles and ball out, right?
Ehhh… no.
Spending more monies as you make more monies is otherwise known as “lifestyle inflation” – and it’s the main reason why people end up dying on the Walmart floor.
When you start making more money, it’s exciting and sexy.
You want to spend more because you feel like you deserve it so you decide to spend it on:
- Getting a new apartment or living in a bigger house
- Upgrading your car
- Spending more on clothes
- Going out more/spending more as you go out (AKA popping bottles)
- More vacations
And I get it.
Once I moved to Austin, I got a really good sales job so I decided to get a nicer apartment and traded in my 2014 Nissan for a NEW 2019 Jeep. ON A LEASE.
DEEAATTHHH. Shoot me 🥸🔫
Although I focused on paying lots of my debt off first, it wasn’t a great financial decision by any means.
I’m still human and make bad money decisions 🥺
The reason why is because there are 2 problems with “lifestyle inflation”:
- Taxes
Most people forget this.
When you make more, you also pay more taxes.
So if you went from making $60k to $100k per year, you’re not making an extra $40k – you’re making an extra $28k because you’re paying a higher percentage to taxes.
Womp womp.
- Debt
When people make more, they surprisingly don’t pay off their debt…
Most of the time, they take on MORE DEBT:
- A new car with a lease
- Spend more on their credit cards
- A big house with a mortgage
This debt ends up making you locked up with your debt lender and your employer – and not in the cute, relationship-type of way:
- Debt Lender – The more debt you take on, the bigger your monthly payments become.
- Employer – Because you take on so much debt, you can’t risk leaving your job for a better opportunity. You’re stuck to working for a paycheck until you pay off your debt and have less risk.
DEATTHHHH.
This is how people have a Walmart floor funeral.
Don’t be like one of these people.
Stick to your budget.
Use the 50/30/20 rule.
Pay off your debt.
You’ll be waayyy better off.
Taquitos,
Caleb Hammer
