Let’s face it. You deserve the best. You really do.

There’s no doubt. Because you are so fantastic, incredible, brilliant, wonderful (insert your own adjective) – in your own way – you deserve the best things, the best experiences, the best in life.

Yet there’s a funny thing that happens when you start regularly consuming the fine things in life that money can buy: you begin to believe that you can’t live without them. Or that you need them all the time.

This is classic lifestyle inflation at work: when any increases in income somehow get swallowed up by new wants masquerading as needs. Mysteriously, like helium slowly inflating a balloon, your spending somehow expands to match your increases in income. It takes up whatever room it can find, pushing in all directions until your budget dangerously nears the popping point.

Interestingly, with lifestyle inflation it’s always spending that seems to float upward, not savings or debt repayments.

So let me rephrase that: You deserve the best. You really do. Just make sure your timing’s right. You’ll probably appreciate the better things in life even more if they keep their rarity and specialness.

The art of the special occasion

It was our anniversary, and things weren’t working out quite as we had hoped. The babysitting options fell through, and instead of dinner out, followed by a show or something, there we were trying to celebrate and having to stay in.

The solution: a fancy dinner at home. I splurged on a bottle of Veuve Clicquot and she spread our finest linen tablecloth. And miraculously, the kids sensed that we were celebrating and kept themselves entertained at the other end of the house.

Now let’s just say that fancy champagne doesn’t make an appearance very often, but we certainly enjoy it. (There seem to be far fewer headaches from the really quality stuff.) And of course we deserve it. (Actually we deserved far better, but you get the idea – it was the best we could do at the time.)

The specialness of that splurge made it all the more memorable. We certainly seem to tell the story to friends much more than the tale of any other anniversary celebration so far. If we bought the same bottle every week or month, I doubt it would have the same effect (but it certainly would have another effect on our money plan!).

Balancing those expectations

It’s easy to see lifestyle inflation at work with the kids, and it’s a tough but important job to rein it in. I often end up shopping with them in tow – not a great idea – and try to make the most of it, getting them to help find bargains and even giving them the balance at the end of whatever savings they point out.

But we had somehow got  into the habit of regularly buying treats – sugary stuff like bikkies, lollies, lemonade – every time we went anywhere. Their expectation came up automatically, easily inflating the cost of going shopping with them by $10 more every time.

The kids were taking it for granted – the sweets were losing their specialness. So these days I get them ready as we head for the shops and let them know that it’s not happening. Or that it is. The point is, it’s just not happening all the time. I’ll keep them guessing.

Financial success is not so much about how much you can buy – it’s about how much you can keep. And the more you can keep, the more options you have to get ahead: paying down debt, saving for a rainy day, investing for those kids’ future.

And of course saving for the special occasions and the better things in life. You deserve them!

 

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