Caitlin's Corner

Lifestyle Inflation: an overlooked financial risk

After spending time with a loved one recently, I’ve noticed my deep sense of worry for her, and a strong desire to help her make changes. During our time together, she shared reflections on her successful career, high income, and the lavish lifestyle she and her husband have built - driven by status, societal pressures, and their desire to provide the best for their children. Despite their significant income and assets, they lack the freedom to spend enough time with their kids, enjoy stress-free vacations, focus on health, meet their children’s unique needs, and pursue their passions.

Her situation is a familiar one for many: she started with a prestigious job in a city she hadn’t envisioned living in, spent decades climbing the ladder, and built a life centered on conveniences and rewards for working so hard. A big house in the "right" neighborhood, private school tuition, club memberships, luxury travel, and daily upgrades slowly created a life barely covered by an income ten times the national average. Now, with little flexibility or mental space to consider alternatives, her lifestyle is entirely mismatched with her ideal wealth vision.

Lifestyle inflation is one of the greatest financial risks we face. I often hear people say, “I want financial independence, but I don’t want to give up my lifestyle.” Unfortunately, our lifestyle can become a trap - dictating where we live, how long we work, and how much we earn, while limiting our choices and dreams.

Avoiding this trap doesn’t mean rigidly restricting (because that is unsustainable) and splurging. Instead, it requires consistently aligning our spending habits with our wealth vision, preserving both financial well-being and personal freedom. Becoming aware of lifestyle inflation is not the hard part, no matter how defeating it can feel. Course-correction is the real challenge. Read below to learn some themes that can help keep our lifestyle creeping towards our vision rather than someone else's.

P.S. Earlier this month, we had an electrifying workshop on defining a clear and honest wealth vision. If a workshop like this sounds interesting to you, hit reply to let us know so we can plan more like this in the future!

Preventing or Correcting Lifestyle Creep🏡 🚙

Below are some themes that may help if you feel like you've built a lifestyle that doesn't match your values:

Understand Spending Habits

Explore your spending patterns and trace them back to decisions you’ve made. Have misaligned decisions led to high fixed expenses that don’t align with what is most important to you?

Let Your Vision Motivate You

Create your wealth vision based on needs, desires, and dreams. You’ll be way more motivated to move towards this vision than to practice strenuous budgeting.

Anchor Your Wealth to Your Fulfillment

Wealth isn't about infinite accumulation but about achieving a state where you can say, "I just want to know that I can [live my dream]." This reframes wealth as a tool to reduce uncertainty and make dreams more predictable.

Build Predictability

This is where financial strategies come in. Building wealth comes down to practicing healthy habits, and those include tracking finances, planning for future expenses, and building portfolios to accommodate those through passive income, appreciation, tax planning, and diversification.

Address the "What If I Want More?" Question

Yes, the human tendency to want more is real, and the fear of it affecting our future is valid. The solution lies in mindfulness and adaptability. Pay attention to how different aspects of your life make you feel, and let this (not societal pressure to spend a certain way) guide your evolving wealth vision. If the things that bring you the most joy become more expensive over time, that’s not inherently bad. Trust in your ability to adapt and adjust your strategies to support your new wealth vision as it evolves.
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What I'm Reading

📕 The late Marina Keegan once said that the writing she was most proud of was her article “Even Artichokes Have Doubts.” In it, she brilliantly examines why so many Yale students, who once aspired to change the world, end up pursuing careers in consulting. It’s a thought-provoking read that explores how the allure of lucrative jobs creates a cycle of lifestyle creep, blurred values, and monetary incentives.

🙋‍♀️ P.P.S. I'm a recovering consultant, and if that read made you feel a little guilty, defeated, or even a bit of denial- you're not alone 😬

Abundance Circle is Underway! 💕

"Hearing you share made me realize I've been struggling with the same thing."

We held our Abundance Circle kick-off and it was a transformative first meeting for those in attendance. The above quote was one of many gems we heard from one member to another. We are so excited about this community!

Even though the doors are closed, we had a few people ask if we could make monthly payment plans available to those who wanted to join. We decided to do it! If you were on the fence about the Abundance Circle and a monthly payment plan makes it accessible for you, you can sign up here.

Note: Our website is only allowing waitlist signups. If you want to sign up, head straight to the monthly deal.

👩‍💻 Need an Investing Refresher?

Want to get on top of your finances, but don't know where to start? Feeling like some investing concepts are out-of-reach? Check out our Investing 101 course. In four bite-sized, and beginner-friendly videos, we break down:

• The fundamentals of investing
• How to invest with your retirement accounts
• Where to look beyond retirement accounts for investing
• What steps you can take to invest with the resources you have​