Lifestyle Creep – Fix Budgets Fast

Lifestyle creep happens. It happens rather quickly.

I’ve started to experience the creep. I put the creep off for a long time, not buying a new car or moving when I got a raise or made more money through a business. But in late 2021, I made a lifestyle shift unconsciously, buying a new home and buying a Tesla.

I’ve been buying on wants and not needs. For example, buying gear for streaming when I only stream on weekends. Instead, I should have built some success by adding a webcam or a Key Light. Now I am using these as a motivator to stream more and build a bigger audience.

I’ve also subscribed to SaaS businesses that make my life easier, some for business and some for personal reasons. A few of these subscriptions save tons of time, and I get a dollar value back. For example, SavvyCal allows me to manage my week, which prevents me from over-scheduling or double booking a meeting. I can also directly charge someone for a 1-hour consultation. Others like Fortnite Crew were only for fun.

How to Stop Lifestyle Creep?

I believe in the principle of investing 30% to 50% of your income. Others have 50/20/30 rules which say spend 50% on needs, 30% on wants, and 20% towards investing and savings. Unfortunately, I broke the rules, stretching my lifestyle beyond the income I had.

I have to make a fundamental change in my financial life in order to not make myself or my family miserable. While my spending increased, the cost of consumer goods steadily rose. For example, a simple grocery store run before was $130 to $150, now that trip could be closer to $200.

The simple answer is to reduce spending and increase income. This, of course, is the goal.

In addition, I am adding actionable goals to straighten out my finances going forward.

Build more “passive income” through courses and templates

Someone said, “I believe everyone has a golden nugget in their Google Drive.” They’re referencing the templates, processes, and documents we’ve all created in Drive. These could be sold and repurposed as a course or template. I’ve started this with the Google Responsive Search Ads Template on Gumroad.

Scale/Increase my Earning Potential for Marketing Consulting

I’ve made great strides with clients. However, I haven’t focused on a website, marketing funnel, or long-term marketing strategy for myself. I don’t have a website for my marketing consulting. I need to define my offering, find clients, and build a site.

Other Side Projects

You may not have known, but I helped co-found and launch IronMic. It was a SaaS business around automated podcast websites. We recently sunset the project, informing customers about an end-of-life plan and how they could move anything off the site. I want to use the end of this project to start something new. I am looking at reviving Gadget Smart Podcast into a place to get bite-sized gadget reviews. It will have affiliate links and be fully SEO optimized.

Stop Buying on Wants

I’ve gone through my subscriptions, stopping ones like Fortnite Crew, Xbox Live, and a couple of other ones that I haven’t been using or that don’t make an impact on my life’s happiness.

Update Finances/Spend with Credit Cards Wisely

I have started down a path recently on credit card hacking (often referred to as points hacking). This is because I want to recalibrate spending on my cards. For example, my Amex Gold card gets 4x points on US Supermarkets, earning more points and giving me value back. There are cards best for utilities, daily purchases, online subscriptions, and other spending. Many offer points or even direct cashback. The Citi Double Cash Back nets me 2% off all purchases, and while small, any amount back helps in the long run.

Monitor Spending with Mint/Quickbooks

I’ve tied all my credit cards into Mint and Quickbooks on the business side. It allows me to monitor cash flow and spending weekly and daily. Having insights into everything is essential. For most of my life, I have operated without any budget. I essentially only spent on things I needed. While I am still not a fan of budgets, I can see within Mint if fast food, for example, is a large percentage of my spending, allowing me to start cutting back and shifting my lifestyle.