Impact of Lifestyle Inflation | Lifestyle Inflation in Singapore
Budgeting | Lifestyleby Priyadarshini 23 February 2022
Are you not able to make enough savings? Do you earn a handsome salary and yet feel poor at the end of every month? It could be because of lifestyle inflation. Read more on the impact of lifestyle inflation in Singapore.
What causes Lifestyle Inflation?
There are numerous reasons for lifestyle inflation, but here are a few of the more common ones. Everyone in hypercompetitive Singapore is constantly stealing looks at their neighbours, attempting to figure out if they’re losing out to them. As your income rises, you begin to associate with wealthier coworkers, and your social milieu undergoes a transition, albeit slight at first. Whereas a night out with pals used to consist of satay and beer at a Kopitiam, your coworkers at your new banking position will not touch drinks created by anybody other than a professional mixologist.
Impact of Lifestyle Inflation
While your Casio digital watch may have gotten plaudits from your hipster pals, it’s guaranteed to raise a few disapproving glances at some stuffy corporate conference. You take on additional obligations – When you earn $1,500 each month, there’s no reason to even consider purchasing a car or a property. In fact, simply making it to the end of the month without needing to borrow money might be considered an accomplishment. However, as your salary increases, you begin to really contemplate acquiring large-ticket products, which will certainly deplete your funds.
The annual cost of owning a BMW might be around $24,500. This means that if you buy a car like this with a $50,000 annual salary (far above the typical individual income), you’ll have about the same amount left over as a guy without a car who makes only $24,000 a year.
The more money you have, the less worried you are about being poor, and the more you will succumb to “treating yourself.” After all, it’s only natural to want to enjoy the money you’ve worked so hard for, right? The problem is that when people feel fortunate enough to relax about money, they frequently go beyond. Even recent graduates in the banking and legal fields are expected to own numerous designer bags ranging in price from $3,000 to $5,000.
Starting salaries in these businesses often range from $3,000 to $5,000 per month, implying that many people are ready to spend the equivalent of a month’s salary to convert their arms into advertising space. Getting reckless with your money – People get careless when they know they would not go hungry if they do not limit their expenditures. While in the past you would have kept a close eye on the clock to ensure you didn’t miss the last bus, nowadays you find yourself taking cabs due to poor time management or simply being too weary.
And you get your daily coffee from Starbucks rather than the kopitiam down the street not because you prefer the taste, but because you can’t be bothered walking 100 meters to save a few dollars. The worst part about this type of spending is that it accomplishes little to improve your living quality. As a result, even if you work longer and harder for your money, you may still feel broke.
How can you put a stop to Lifestyle Inflation?
The impact of lifestyle inflation can be dangerous if you do not work towards correcting your expenditure habits. If you’ve been living on a salary that would be unlawful in a country with a minimum wage, some degree of lifestyle inflation is unavoidable and probably beneficial to your health and sanity. This means you can finally quit jumping over MRT gantries and sneaking snacks from the office cupboard to avoid missing dinner. However, beyond a certain point, lifestyle inflation becomes absurd.
The good news is that, as long as you’re aware of it, lifestyle inflation isn’t too difficult to control. If you could live on less before, there’s no reason you can’t do so now. Just keep in mind that you’re still the same person you were before, even if you have a little extra cash in the bank. Yes, luckily or sadly, no matter how huge your car is, you’re still you.