First Person: Keeping Lifestyle Inflation in Check

Yahoo Contributor Network

My husband and I find it challenging to keep our costs down as the prices of products creep higher. Part of the problem isn't the higher cost of items in the grocery store or malls. Part of the problem is that we try more expensive things and then start to get used to a better lifestyle. Pretty soon, we are victims of our own lifestyle inflation. After getting a pay cut this year, I found it difficult to lower my lifestyle demands. Still, I made an effort to be frugal and get used to living on less money instead of putting things on credit cards.

Keeping a consistent budget

One of our strategies for combating inflation is to keep a consistent budget. We actually had to trim our budget due to my sizable pay cut. However, even when my husband receives pay bonuses, we don't increase our budget for food, clothing or various expenses. Instead, we funnel the extra money into savings. When I notice the prices at the grocery store getting higher, I go out of my way to use coupons and search for special deals.

Giving up the name brands

I'm guilty of brand loyalty. Unfortunately, when I try more expensive products, I often become attached to them. I've had to learn to be blind to the brands when I shop. Even though it takes a few weeks to get used to the generic food products, I do eventually adapt. Sometimes my favorite brands do go on sale. In some cases, I'm able to combine a case discount with a coupons and a sales price for what I call a triple deal.

Living on my 1999 salary

I was making a starting salary in 1999 when I started with a new company. I decided to basically freeze my budget at that time. I still pretend as though I make that same starting salary. After numerous pay raises, a few temporary pay cuts and one permanent pay cut, I make about $10,000 more than I did in 1999. We use that extra $10,000 to pay down our mortgage and save for retirement.

Being happy with what we have

Another way we avoid lifestyle inflation is by being happy with what we have. We don't trade our car in for newer models. Even when get got right side up on our mortgage, we didn't put it on the market so we would buy a step-up home. One of my close friends is always comparing herself to her neighbors. She is stuck in the "Keeping up with the Joneses" mentality. I figure there will always be someone who is smarter and wealthier. I'd rather be satisfied with what I have.

Although we have had to scale back on our lifestyle in some ways, we have also been fortunate to live in a part of the country that is fairly affordable. We live in Florida where the prices are not as high as other parts of the country. We get a better lifestyle, including sunshine and scenery, for less by living in Florida.

*Note: This was written by a Yahoo! contributor. Do you have a personal finance story that you'd like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.

More from this contributor:

Five Financial Reasons I Miss Renting

5 Best Money Moves after Getting Married

Less Vacation is the new Normal

Rates

View Comments (1)