Badass vs Dumbass
Master your Financial Kung Fu to be one and not the other.
Go to Sifu’s Notebook for 7 Killer Ways to Avoid Lifestyle Creep
Primer: Who are Sifu & Ronin
Episode 16: Ronin Punishes The Creep
Ronin: Sifu! Man oh man, I’m in deep do-do. After the last session with you, I’m just starting to realize this lifestyle inflation is attacking me like a horde of hungry zombies from Walking Dead. My bank account balance has dropped lower than the temperature on a winter night in Minneapolis. It might go negative soon … yikes!
Sifu: Ah, Ronin! That inflation creep, like a virus, affects many of us, so you are not alone. In fact, I think The Creep is more dangerous than COVID was. We mostly killed that sucker off. How are we going to kill The Creep, #1?
Ronin: Ai Ya! Putting it in those terms is starting to scare the bejesus out of me more than the Netflix horror movie did last night!
Sifu: Fear not, Padawan. Sifu is here to back you in this Mission Impossible. If Ethan Hunt can overcome insurmountable odds, so can you, Agent Ronin.
Your mission, should you choose to accept it …
From Mission Impossible (1996)
Ronin: Sick! Do I use a Glock 17 to shoot up The Creep or should I go with the explosive gel to blow the face of this treacherous demon.
Sifu: Well #1, if it was that easy, we would just take a trip to the gun shop and get ‘er done. No! This illusive foe will require a different strategy. First we need to hunt The Creep. Alas, before we can kill it, we need to find it first. The Creep is well hidden from those in denial or those who just ignore this serious issue. Do you recognize the signs of The Creep?
I’m going to need a bigger gun.
From Mission Impossible II (2000)
1. Spot the Creep
Ronin: I got this one, Captain! The signs are starting to be pretty obvious to me. Like when I hit my favorite Starbucks. Back in the day, I would get the smallest size regular coffee – all I could afford with my minimum wage job. Nowadays, it’s latte city just because my paycheck has grown since the days of being broke-as-a-joke. And that’s just the tip of the iceberg.
Sifu: Good example, #1. You actually gave quite a few others in the last session, so I agree, you got this. Unfortunately, The Creep, once found is much harder to kill than the low level bosses of Diablo IV.
Ronin: So Sifu, we’re talking about next level action here: World Bosses, Elite Bosses, Dungeon Bosses, Legendary Bosses. Yikes, much harder to kill. They usually get me before I can get them all. You saying this is the end of me, bossman?
2. Set Clear Financial Goals
Sifu: Not so dire – not yet anyways! Let’s dive into the ways we can start punishing The Creep before it eats us up and spits us out! You have to clarify your goals. Setting specific goals will help keep your eyes on the prize.
Ronin: Clear goals, right! So like my goal of quitting rental hell and moving to my own condo. Crystal clear, boss!
Sifu: Precisely, #1. In fact, write down your top three financial goals and create a plan to achieve them. Doing so will give your money purpose. Your goals are your highest priority. Everything else needs a serious demotion – get me bro?
Ronin: I got it, big guy. Will keep those goals clear in my mind, and hopefully will not be distracted by everything else that my money can be wasted on. That was a solid punch to The Creep’s backside, am I right, my man?
3. Live Below Your Means
Sifu: Right on the money, Padawan! Now, just because you can afford it doesn’t mean you should buy it. Living below your means is like having a financial diet.
Ronin: So, I should live like a penny-pinching broke-ass student, even though my bank account says I’m rolling in green? That is one fun diet—a slight upgrade from a cold water sandwich!
Sifu: Hee-hee. Perhaps you can upgrade from daily instant noodles, but you should def budget below your current income level. Save at least 20% of your income, or much more if possible. Think of it as putting a financial muzzle on your bad spending habits.
Ronin: Well, it’s a good thing I love me my basics, LOL! Goodbye, luxury splurges—hello rice and beans, subway rides with stankzilla homies, and DIY spa days!
4. Avoid the Joneses’ Trap
Sifu: Sounds like too much fun, #1, but I’m too busy to join you! Now, social media is like a parade of excess. Remember, what you see online is often a highlight reel, not the reality of people living beyond their means.
Ronin: Heard. There is a lot of bling on the web, but that is becoming a snorefest spectacular for me. Kardashians are pure bullshit anyways. Rich people do so much stupid shit with their money – it’s bananas. Maybe it’s for the attention. Well, they just lost mine. Gonna unfollow all that bizniz.
Sifu: I concur, #1. Leave that stupid bananas shite to others. YOU need to kill that Doofus Creep Monster.
Ronin: Cold-blooded Creep Killa is here, Batman – let’s roll.
5. Prioritize Experiences Over Stuff
Sifu: Investing in experiences rather than things will lead to more fulfilling memories. Stuff depreciates faster than a celebrity’s career after a scandal.
Ronin: Hmmm. So, instead of buying that new PlayStation, I should take a cooking class I was looking at?
Sifu: Wow, I never thought you could make such an excellent decision! You’ll love the experience and as a bonus, you become Master Chef Junior, and will be the envy of all around you. Dude! Get on that!
Ronin: Right away, boss. My unquenchable appetite is ecstatic and onboard! I heard that they teach you knife skills there too. I can sharpen those, eh boss, get me?
Sifu: Yeah I think so, Dave Chappelle Lite. You know, you’re very quick, #1. But your extra sharp blades will still not get close enough to me to do any damage, right? Unless Barry Allen is your cooking partner. Then, I’ll worry 😉
6. Review and Cut the Fat
Sifu: Regularly review your expenses to cut out unnecessary charges. Think of it as a financial spring cleaning—minus The Creepy dust bunnies!
Ronin: Yeah, that’s the budget review you told me to get on. I’m going to think of that Dumbass Creep every time I see those expenses, and slay them MoFo’s!
Sifu: MoFo’s have no chance against you, Wolverine!
7. Master the Art of Delaying Gratification
Sifu: Delaying gratification is a powerful weapon against impulse buys. Give yourself time to decide if you really need or want that new thing. Maybe even 30 days.
Ronin: 30 days, boss? How about 7 days? You don’t give me enough credit. I’m getting better and faster at making tough decisions. You’ve taught me well, Sifu!
Sifu: Well then, I shouldn’t see very many impulse buys followed by financial regret from you any more, correct?
Ronin: Yessir! Wins like that will feel like a deadly roundhouse to The Creep’s numskull!
Sifu: Oh, my dude. I am getting excited for you here. I actually approve of your new anger towards this formidable foe. The Creep is a total asshole! It will be no match to your soon-to-be-acquired financial assassin skills.
Ronin: I’m going to chop up that MoFo Creep like sashimi, bro! Dang it, now I’m hungry – can we eat?
Sifu: Some demons will be harder to slay than others, LOL.
Sifu’s Notebook
7 Top Steps to Avoid Lifestyle Creep
1. Recognize the Signs
Recognizing the signs of lifestyle inflation is the first step in tackling it. Often, it starts with small, seemingly harmless upgrades that gradually become the norm.
Action Steps:
- Track Your Spending: Use budgeting apps or spreadsheets to monitor where your money is going. Document every purchase, no matter how small.
- Identify Patterns: Look for patterns in your spending. Are you frequently upgrading gadgets or dining out more often?
- Set Spending Limits: Establish limits for discretionary spending categories like dining out or entertainment. Check if you’re exceeding these limits.
2. Set Clear Financial Goals
Setting clear financial goals provides direction and purpose for your money. Without goals, it’s easy to justify unnecessary expenses.
Action Steps:
- Define Your Goals: Write down your top three financial goals, such as saving for a down payment on a house, building an emergency fund, or planning for retirement.
- Create a Plan: Develop a detailed plan to achieve each goal, including timelines and required savings amounts.
- Monitor Progress: Regularly review and update your goals. Set reminders to evaluate your progress and make adjustments as needed.
3. Live Below Your Means
Living below your means is a fundamental principle for financial stability. Just because you have the means to buy something doesn’t mean you should.
Action Steps:
- Develop a Budget: Create a budget that is lower than your income. Allocate a specific amount for savings and investments each month.
- Reduce Non-Essential Spending: Cut back on non-essential expenses like dining out, subscriptions, or impulse purchases.
- Increase Savings: Aim to save at least 20-30% of your income. Automate transfers to savings and investment accounts to make it easier.
4. Avoid “Keeping Up with the Joneses”
Avoiding the temptation to “keep up with the Joneses” is crucial in maintaining financial discipline. Social media and peer pressure can lead to unnecessary spending.
Action Steps:
- Limit Social Media Exposure: Unfollow or mute accounts that trigger feelings of inadequacy or pressure to spend.
- Practice Gratitude: Regularly reflect on and appreciate what you already have. Keep a gratitude journal to remind yourself of your financial successes and personal achievements.
- Set Boundaries: Establish boundaries for how much influence social media and peer spending have on your financial decisions.
5. Prioritize Experiences Over Things
Prioritizing experiences over material possessions can lead to greater happiness and fulfillment. Experiences often provide more lasting joy than things.
Action Steps:
- Plan Experiences: Allocate a portion of your budget specifically for experiences like travel, classes, or activities that create lasting memories.
- Evaluate Purchases: Before making a big purchase, consider if there’s an experience you’d prefer to invest in instead.
- Create Memory-Making Opportunities: Make a list of experiences you want to have and actively work towards achieving them, whether it’s a weekend getaway or learning a new skill.
6. Review and Cut Unnecessary Expenses
Regularly reviewing and cutting unnecessary expenses helps you identify areas where you may be overspending due to lifestyle creep.
Action Steps:
- Audit Your Expenses: Go through your bank statements and credit card bills to identify recurring charges and subscriptions you no longer use or need.
- Cancel Unused Subscriptions: Eliminate or downgrade subscriptions and memberships that aren’t adding value to your life.
- Set a Review Schedule: Regularly review your expenses, at least quarterly, to ensure you’re not paying for services or items you don’t use.
7. Delay Gratification
Delaying gratification can be a powerful tool to combat impulse purchases and avoid lifestyle inflation. It allows you time to evaluate whether you truly need or want an item.
Action Steps:
- Implement a 30-Day Rule: For significant purchases, wait 30 days before buying. During this period, assess whether you still want the item.
- Create a Wishlist: Maintain a wishlist for non-essential items. Revisit the list after 30 days to determine if you still desire the items.
- Evaluate Necessity: Ask yourself if the purchase aligns with your financial goals and whether it’s a need or a fleeting want.
