Do you upgrade your lifestyle every time you get an increase or promotion at work? I mean after all, who doesn’t want nicer things and more luxury conveniences.

Signs of upgrading

•    New subscriptions to streaming services or country clubs
•    New car with higher monthly premiums
•    You are buying fancier foods that are all organic and gluten free
•    You use car services instead of taking public transport
•    New house with higher mortgage
•    Your go out more often and go to nicer places
•    You eat out more often
•    You buy nicer and more expensive clothes
•    You spend more on grooming and grooming products e.g. hairdresser, manicures etc.
•    You go on vacation more often and stay in luxury hotels and destinations


If you can answer yes to several of these, then you could be in danger of experiencing lifestyle creep.

Lifestyle creep, the silent killer of pensions, is when as you earn more, you upgrade your lifestyle and spend more. You increase your spending but unfortunately not your savings. 

This could lead to your retirement savings or emergency fund savings not being sufficient. If your monthly expenses increase and you don’t increase your retirement savings, you might not have enough to afford the lifestyle that you currently lead when you retire. This could see you downgrading your lifestyle at retirement.

It is important to increase your savings in relation to your expenses or try to avoid spending more when you get an increase.
•    Monitor your spending and keep a tight fist on your budget. Ask yourself if you really need a bigger house, newer car, or that exclusive membership, or are you only doing it to maintain a status or keep up with the Jones’s?

If you suspect that you are falling victim to lifestyle creep, chat to your adviser immediately to help you get your finances under control and re-evaluate your savings strategy. [email protected]

Please note, the above is for education purposes only and does not constitute advice. You should always contact your deVere Acuma adviser for a personal consultation.
* No liability can be accepted for any actions taken or refrained from being taken, as a result of reading the above.

 

News you might like

Media contact

deVere Acuma’s Public Relations Department deals with all areas of the media and external communications including international, national, regional, local, trade, consumer, print, broadcast, social and online. The Department aims to provide a helpful service to journalists, broadcasters and editors, amongst others, and reply to all media enquiries, including urgent enquiries out of hours, within agreed deadlines. Our press office does not have access to client details and will not be able to assist with individual client enquiries. Please contact deVere Acuma’s Head of Media and Public Relations for deVere Group on [email protected] or call +971 2071220925