We Lost to Lifestyle Inflation. Here’s How We Fought Back.
We Lost to Lifestyle Inflation. Here’s How We Fought Back.
April 20, 2020 by Ed
Do you find yourself spending every penny you earn, no matter how much you make?
Lifestyle inflation (a.k.a lifestyle creep) was our biggest financial mistake. Sure, education isn’t a path to extreme wealth, but you can earn a decent living. Even as two brand new teachers, we earned above the median household income. Over time, with use of the education career ladder and teacher side hustles, we tripled that initial income. Then we spent every cent.
The result? After 15 years, we had a barely positive net worth. We’d gone from spending just over $3k a month to spending 3x that. A mountain of debt balanced out our assets – two car loans, a house that was too big, and a vacation home. We’d lost to lifestyle inflation. Badly. Here’s how we woke up and fought back. You can too.
What Is Lifestyle Inflation?
Lifestyle inflation means your living expenses grow as fast, or faster, than your income. If you’ve experienced this, you may feel weak or dumb. We certainly did when we became aware. Don’t.
You Can’t Choose The Cards, But You Can Always Play The Hand You’re Dealt
.You Can’t Choose The Cards, But You Can Always Play The Hand You’re Dealt
April 27, 2020 · by The Escape Artist · in Health & Happiness · 10 Comments
There is something missing from the debate on Covid-19.
As far as I can see, most of the news and related debate involves looking for someone to blame.
China, Dominic Cummings, Donald Trump and the World Health Organisation all make excellent pantomime villains (the choice of which to blame depends largely on your political biases).
The problem with The News is not its bias. The problem is the media pretending to be unbiased. When you control the editing and publishing, you can control what gets seen, heard and discussed.
We all have our biases. As someone who writes a blog based on the idea (partly tongue-in-cheek) that we are living in a Matrix-style Prison Camp created by big corporations, big government and the Deep State, I was struck by this tweet promoting a communist regime from a globalist bureaucracy pretending to be a health charity:
World Health Organization (WHO)✔@WHO
Preliminary investigations conducted by the Chinese authorities have found no clear evidence of human-to-human transmission of the novel #coronavirus (2019-nCoV) identified in #Wuhan, #China🇨🇳. 7:18 AM - Jan 14, 2020
Staying Calm When Facing Financial Uncertainty
.Staying Calm When Facing Financial Uncertainty
Calming Your Nerves When Facing Your Own Financial Uncertainty
March 30, 2020
The reality is that we all need money to live. We have rent to pay, loans to pay back, and food to buy.
So when our source of income is threatened by some unforeseen circumstance, it’s easy to feel a rush of nerves. It’s a scary situation. But there are steps we can take to help us calm our nerves when faced with financial uncertainty. And by taking these steps we can start to feel confident in our finances and relieve some of our anxiety.
This is exactly what I did recently when feeling overwhelmed with all of the recent what-ifs of life. I sat down, opened my budget, ran some numbers, and laid out some contingency plans. Doing this simple exercise helped put my mind at ease. It gave me a sense of relief while also giving me the information I would need to make future financial decisions. Knowledge is power. If you are feeling nervous about your potential financial future, here are a few steps you can take to ease your nerves.
Finding Financial Confidence To Make Smart Money Decisions
.Finding Financial Confidence To Make Smart Money Decisions
Find the Financial Confidence You Need To Make Smart Money Decisions
March 10, 2020
Making financial decisions, and feeling confident about them, is no easy task.
The decisions we make for our money can have long term effects on our financial well-being. And that can be a terrifying realization.
Decisions like: How much mortgage can I afford? Is this the best price I can get on airfare? How much should I be saving? Do I invest my savings? What do I invest in? Can I quit my job? Do I have enough money to retire?
These are all tough decisions, and it’s easy to stress out about making the “right” choice. If we aren’t a financial professional, money expert, or a travel hacking guru, we may not believe we have the expertise needed to make smart money choices. And this makes feeling confident in our financial decisions hard.
America Finally Found The Lost City Of Gold
.America Finally Found The Lost City Of Gold
Notes From The Field By Simon Black April 23, 2020 Bahia Beach, Puerto Rico
In the early 1530s, a Spanish conquistador named Diego de Ordaz was exploring modern-day Venezuela when he first heard rumors of a nearby City of Gold.
Ordaz thought he was about to hit the jackpot. And he wasted no time ordering expeditions of the area to find this city-- what eventually became known as El Dorado.
The mission failed, and most of Ordaz’s men died. But one survivor, a crewman named Juan Martinez, claimed that he had been captured and held prisoner for 10 years in El Dorado.
Martinez told sensational tales about the city’s golden structures adorned with precious stones, and even said that the local king bathed in gold dust every morning.
The Next Giant Industry In Need Of A Bailout
.The Next Giant Industry In Need Of A Bailout
Notes From The Field By Simon Black April 20, 2020 Bahia Beach, Puerto Rico
Well this is starting to become a trend.
Over the past few weeks, state governments across the Land of the Free have been feverishly proposing new legislation that will virtually guarantee the entire insurance industry is wiped out.
The root of the issue has to do with something called business interruption insurance.
Business interruption is a pretty common type of insurance that’s designed to protect business owners against a number of risks.
For example, let’s say you own a restaurant and you have a bad kitchen fire that forces you to shut down for a month. You’d most likely have a fire insurance policy to cover the direct damage of the fire. And a lot of companies would also have a business interruption policy to help them stay afloat during that one-month period while the business is closed for repairs.
They'll Wreck The Currency If They Have To
.They'll Wreck The Currency If They Have To
Notes From The Field By Simon Black
April 21, 2020 Bahia Beach, Puerto Rico
Nearly seven centuries ago in the mid-1300s, the first major outbreak of the Bubonic Plague forced Europeans into some of the harshest social distancing measures in history.
As Boccacio wrote in The Decameron in 1353, the hysteria was so extreme that “brother abandoned brother. . . fathers and mothers refused to see and tend their children, as if they had not been theirs.”
When people sensed the worst was over, they slowly came out of their homes.
There was no grand re-opening of the economy like some department store suddenly under new management. People remained highly mistrustful of one another, continuing to avoid even the most basic interactions with friends, family, and professional colleagues.
Commerce was slow and the economy remained depressed for years.
And just when it seemed that the situation was finally starting to improve, the plague struck again in 1360. And again in 1374.
How to Protect Yourself From Credit Card Theft
.How to Protect Yourself From Credit Card Theft
By Emily Guy Birken February 2020
Last fall, I received an email that appeared to be from my web host. The email claimed that there was a problem with my payment information and asked me to update it. I clicked on the link in the email and entered my credit card number, thinking that a recent change I'd made to my site must have caused a problem.
The next morning, I logged onto my credit card account to find two large unauthorized purchases. A scammer had successfully phished my payment information from me.
This failure of security is pretty embarrassing for a personal finance writer. I know better than to click through an email link claiming to be from my bank, credit card lender, or other financial institution. But because the email came from a source that wasn't specifically financial (and because I was thinking about the changes I had made to my website just the day before), I let myself get played.
Improve Your Finances Now
.Improve Your Finances Now
16 Small Steps You Can Take Now to Improve Your Finances
By Alicia Rose Hudnett January 2019
You have all kinds of financial goals you want to achieve, but where should you begin? There are so many different aspects of money management that it can be difficult to find a starting point when trying to achieve financial success. If you're feeling lost and overwhelmed, take a deep breath.
Progress can be made in tiny, manageable steps. Here's are 16 small things you can do right now to improve your overall financial health. (See also: These 13 Numbers Are Crucial to Understanding Your Finances)
1. Create a household budget
The biggest step toward effective money management is making a household budget. You first need to figure out exactly how much money comes in each month.
What to Do With a Windfall
.What to Do With a Windfall
By Emily Guy Birken January 2020
Theoretically, a sudden windfall should reduce your financial worries. Who doesn't appreciate getting suddenly richer?
However, making good decisions with a large infusion of cash can feel overwhelming, especially if your windfall comes about because of something negative. For instance, when I received a life insurance payout after my father passed away in 2013, the money was both emotionally charged and stress-inducing, and I was terrified of making a misstep.
If you've received a windfall, taking your time and making intentional decisions about the money will serve you better in the long run. Here's how you can do that.
The 6 Best Ways to Invest Just $100 Per Month
.The 6 Best Ways to Invest Just $100 Per Month
By Holly Johnson February 2020
The new year is the perfect time to ditch poor financial habits and pick up some new ones. Maybe you decided that this is the year you'll finally pay off high interest credit card debt, or perhaps you're using a budget for the first time in your life. Whatever your goals are, you probably know that it will take time and perseverance to get there.
But how should you invest your money? If you have an extra $100 per month to spare, there's more than one way to build wealth and finally get ahead.
We reached out to financial advisors to find out how they would invest an extra $100 per month in the new year, and here's what they said.