When is a lifestyle upgrade OK?

This post is from CYH, who is about to become a graduate student in another country so she's examining her lifestyle carefully. This story is one of our Reader Stories series. Some stories contain general advice; others are examples of how a GRS reader achieved financial success or failure. These stories feature folks with all levels of financial maturity and income.

I've saved. I've paid debt down like the last remaining survivor beating back a zombie at the door of the space shuttle to Mars. But, now that I have some financial freedom, how do I make lifestyle changes without incurring lifestyle inflation? When does it become lifestyle inflation?

The Scrooge in me wants to keep scrimping and saving, but at some point, I just want to live better and have nice things. As such, I'm currently going through the process of semi-upgrading my lifestyle. I can make the choices that I've been wanting to make, mainly choosing quality over disposability. Also, now with an imminent move to a tropical country for graduate school, I'm also finding that many of my clothes will not be climatically appropriate. Instead of getting there and realizing that all my stuff is not going to work, I'm planning ahead and investing some time and money to prepare. Here are some things I've started doing:

  • Combed through my possessions multiple times, whittling down the amount of Stuff and donating useable things that I don't need or would not use again several years from now. My mantra has been “BE BRUTAL!” Some things that passed my inspection the first or second time did not make it through the third or fourth time. Really thinking about whether I like something enough or would really need it four years from now (e.g., all those sweaters I've managed to pile up) takes some time and second-guessing, but in the end I know I'll make progress.
  • Participated in a local Community Supported Agriculture summer season for somewhat more expensive but better quality vegetables. I got a half-share, and even if they only gave me delicious tomatoes, I would be happy as a clam. However, this experience has also exposed me to some vegetables that I would never have bought for myself.
  • Invested in a small closet-full of merino wool(!!) and other moisture-wicking clothing (specifically, underwear, which might not be the first thing you think of, but after spending a few days literally sweating my butt off, this is something I know I will need!).
  • I don't eat out very often anyway, but now when I occasionally do, I'll go back to a few favorite spots that may have been out of my budget range a few years ago. Places I won't be returning to aren't worth my time and money if they truly aren't giving me something delicious to fill my belly. Otherwise, I could cook for myself and my friends and have a better meal. Say, instead of spending $20-25 on eating out for lunch a handful of times, I'll go out to dinner with friends.
  • These feet I have are the only feet I will ever have (hopefully, though it looks like there are some good options if I need them) and good shoes go a long way to keeping those feet happy.

What I plan for the last few months before I move:

  • Go through my wardrobe and closet a few more times to get those last few items to a collection facility where someone who would really use the clothing will have a chance to find it.
  • I'm considering finally making the leap to a smartphone with a data plan…or at least a texting package. So far my dumbphone (which is actually an older generation smartphone demoted to dumbphone functionality) has worked well in conjunction with using my iPod Touch on WiFi signals. But tweens seem to have more “grown-up” mobile plans than I do, so it might be time to bump up.

In this process, it has been important to remind myself that I'm not getting rid of old things just to make room for new things. I also need to keep in mind my values and especially examine what I actually use vs. what I think I would use. For example, I occasionally enjoy trendy clothing, but I don't wear them very often. In this case, I would not consider many of these clothing items as “needs,” but as “wants” because I do not use them enough to warrant bringing them with me halfway around the world or spending a lot to acquire them in the first place.

Overall, the threat of moving abroad for several years has really helped me to gain perspective and focus about my Stuff. I might have kept some things for another year or two, but knowing that I don't want to come back to boxes of Stuff that I'm just going to give away anyway has been a useful reality check. But, I still think about those questions quite a bit: When do lifestyle upgrades start to bleed into inflation? How do I make upgrades without getting to that bleeding edge?

I worry that this flurry of changes and the expectations that come with them will be hard to readjust to my new graduate-student budget, and for a new life in a new country (which is also an extremely consumerist country).

More about...Budgeting

Become A Money Boss And Join 15,000 Others

Subscribe to the GRS Insider (FREE) and we’ll give you a copy of the Money Boss Manifesto (also FREE)

Yes! Sign up and get your free gift
Become A Money Boss And Join 15,000 Others

37
Leave a Reply

avatar
newest oldest most voted
PigPennies
PigPennies

I think it only becomes lifestyle inflation when you start trying to keep up with the Joneses. This could be the stereotypical example of making the decision to upgrade your house, only to decide you need new furniture, landscaping, and a luxury car in the drive like your neighbor. But, it could also mean deciding it wouldn’t hurt to expand (or add) a cable plan because adding a data plan and smart phone didn’t hurt too much. As long as you make conscious decisions on changes and then stick with just those, you’re still in control. If you’ve been living… Read more »

Marsha
Marsha

In my opinion, now is not the time to upgrade your lifestyle. You need to save every penny you can in anticipation of the upcoming move. There’s no way you can really know how expensive it’s going to be in the foreign country until you’re living there. And don’t upgrade your phone now. Wait until you move and see what you need or want then. (Upgrading because every tween has better than you is also an extremely poor reason. Only buy as much phone as you truly need.) As far as what personal possessions to store, it depends on how… Read more »

CYH
CYH

Thanks for your advice! Just for some context, I have been living at home with family, and have been able to save up quite a bit. I also have a pretty good understanding of what my expenses will be there, and I will have a stipend that will just barely cover those expenses. As for the phone, this country is in Asia, where phones are actually more expensive than they are in the US because there is not subsidizing of phones and they just charge more for the darn things. Considering this, I may just buy a used or new… Read more »

Meggan Orenstein
Meggan Orenstein

I have been living in Asia for a little over a year now and would highly recommend NOT buying a phone in the US! Cell phones and other electronics can be regionally specific and most US phones will not work over here. I think of a cell phone and a data plan as tools, not an indulgence, especially when traveling in Asia. Can you ask some of your contacts what they use, guesstimate costs and plan accordingly? See if they know of anyone willing to sell you a used phone or take over their contract, at least until you are… Read more »

CYH
CYH

Hi Megan, thanks for your advice! I’ve spent quite a bit of time in Asia, and I know that having a data plan will help me to not get lost in a new place! This is mostly why I would opt for a smartphone of some sort. I’ve looked up what frequencies would be necessary to get service where I’m going, and will make sure that whatever phone I bring over will be compatible.

You make a good point about asking people I know if I could possibly buy a phone from them. I hadn’t thought of that! Thanks!

Stacie
Stacie

I would not do a lifestyle upgrade right before grad school – especially considering the grad school is out of the country. I would wait for the phone upgrade until you get to the new country. US data plans can be VERY expensive in other places, and that’s assuming the phone will work there. On the other hand, I am in the midst of a life style upgrade right now. I’ve been out of college for 2 years now, living with a roommate. Tomorrow I go to sign the lease on my own apartment. It is a little scary thinking… Read more »

Lynn
Lynn

Stacie,

As you furnish your new apartment remember thrift stores, Craigslist and Freecycle to name a few sources of house hold items. Items like dishes, pots and pans to name a few don’t need to be new. The worst thing you could do is to start “shopping” at places like Crate and Barrel where you would pay through the nose. Save up for nicer stuff and ask for items for Bdays and holidays. When I bought my first place I got a vacuum cleaner I think for Christmas.

CYH
CYH

I’m also excited to move out. I’m currently living with my parents and sister (my older sister only just recently moved out after getting hitched). I will have to adjust for more money going towards housing, but I think I will be able to manage as long as I find a place that is within my budget. The apartments for rent where I am going are often fully furnished, so thankfully I won’t have to worry about that! I may have to buy some kitchen things though.

Thanks!

Dana
Dana

I’m curious as to what you’ll be doing in this other country. Really just for context to better understand your story. My first thought was scientific field work, just because that’s what I’m familiar with and I know several people who have been in the Amazon doing field work. If that’s the case, I know from personal experience that it’s very easy to spend a lot of money on clothes, not to mention gear. And it’s not like I bought everything from REI (I could never afford that!). For me, some of that was worth it and some wasn’t, but… Read more »

CYH
CYH

Actually, I will be doing science over there! I don’t have much in the way of field clothes (nor do I know if I will be doing a whole lot of field work or just some, since I’ll be doing some geeky computer modeling things). I have been buying REI and EMS gift cards on discount and using them when I need to. Thanks for your advice!!

Katherine
Katherine

I’m a little too confused about your situation to make any comments. Will you be funded in school? Is your cost of living going to drop? What goals have you reached that are prompting this question? In other words, what IS your financial situation? That said, I’ve asked the same question, for sure. My boyfriend and I lived together while he was in grad school (living on loans) and I was making roughly $15,000/year. Then we spent three years with both of us working in well paying jobs, with a combined income that allowed him to pay off his debt… Read more »

CYH
CYH

I’m sorry that you are confused! I wasn’t sure how much information about myself was necessary or wanted in this post. To answer your questions: I will be funded My cost of living will increase slightly I’ve reached some goals of saving a chunk for retirement, and having a large enough cushion that can help supplement the funding I’m getting for the next 4 years. I’ve been in graduate school before, so I have some memories of what it was like to not have income at all. I really wanted to go through this process because of the values that… Read more »

Katk
Katk

Well, it’s hard to say without knowing what country. Is it 1st world or 3rd world? Have you spent much time there? The first time I moved to Japan, I bought all sorts of gear, all of which I could have gotten there of course. I might have saved a little money buying it here, but I ended up not really needing it, and could have gotten even better stuff there. That is to say, the local stores are selling things needed for the particulars of living there, so it may be better to wait. And, if there is something… Read more »

Lauren {Adventures in Flip Flops}
Lauren {Adventures in Flip Flops}

I’m living in China at the moment, and I agree with this! I brought a bunch of things that people said I would need, but I didn’t. I’m glad I brought a bunch of medicine (they don’t sell the same stuff here), but other than that, I could have waited and bought most things for less money.

Also, local food is better and cheaper than what it considered Western here, so I fully agree with that!

CYH
CYH

It is arguably a very developed country, with very good food to boot (but it almost makes me sad that it would probably be cheaper to eat out than to cook). I’m actually a little concerned about not having access to healthy food.

I have been looking forward to planning for more experiences because it is easy to get around, rather than for more purchases. I don’t expect to need much when I get there besides food and basic needs!

Thanks for your advice!!

Katk
Katk

Definitely second the waiting on a phone unless you are sure that it will work there and not cost you extra (which I am almost sure it will)!

Nandu
Nandu

If were you, I would wait until after I get to that country unless you’ve already been there and know exactly what to expect

Wm
Wm

This reminds me of the time when I had to move from the US to a tropical country after I completed my graduation. One of the first things to go were a plethora of books that I had been holding on to. That was both easy and difficult, coz even though most of the stuff are on the internet, I still like the familiarity of a used book, with the innumerable markings and personal notes of mine. When it came to clothes, I easily parted with huge bags of clothes, especially ones I didn’t love anymore. But there were still… Read more »

Barbara
Barbara

I agree on holding off on the phone upgrade until you get there and the same may go for your clothes. Unless you have spent a lot time in the country and even on the campus you may find what you THINK you will want to wear is not what you will when you get there. Clothing choices on many campuses are decidedly casual. Store only what you desperately love and are sure you will want 4 or 5 years from now. I had a large home when one of my daughters went to to a distant campus so she… Read more »

Catherine Jean Rose
Catherine Jean Rose

I enjoyed reading your story, and can tell you’ve developed some wise frugal habits at a (presumably) young age. I found, however, it’s not what you said, but what you DIDN’T say that gives me pause. How old are you? Have you eliminated all your debt, i.e., undergraduate loans, credit card debt, car payments? Will you be generating income while attending graduate school, or accumulating debt to pay for it? What have you saved for retirement? These are the most pressing questions that I’d need to reconcile with myself before allowing an increase in lifestyle inflation. Best of luck on… Read more »

CYH
CYH

Hi Catherine, Thanks for your advice!! Again, I wasn’t quite sure how much info to expose about myself, but since you asked… To answer your questions: I am just past my mid-twenties. (I don’t quite want to say late twenties just yet!) I am free of debt, except for whatever is going on that month on my credit cards. I will have an income (scholarship with a monthly stipend). This should cover basic needs. As for retirement, this is what I struggled with the most in the past few months. I know I won’t need a lot of extra money… Read more »

Peach
Peach

I find myself mentally asking a some questions that aren’t really answered here, and that’s throwing me off a little, such as what country/region will you be living in and how easy is it to get the clothing you need and a good smartphone once you get there. I think I’m assuming many things will be cheaper once you get there, which may or may not be the case. It sounds like you’ll be storing your stuff somewhere while you’re gone, if so, is space at a premium? Because I don’t think I’d go thru a fill scale purge and… Read more »

El Nerdo
El Nerdo

If you’re going to grad school abroad, you’ll want a pile of cash as big as you can. They sell clothes in the tropics– much cheaper usually than in first-world countries.

You know the old saying about traveling– bring half the stuff and double the money you think you’ll need.

CYH
CYH

They do sell clothes in the tropics! I plan on not bringing many, or any, business-y clothes with me because they are not the easiest to pack, and I’ll be able to get them over there if I need it. I think the biggest category of things I’m getting rid of are T-shirts. I probably have about 30 from the high school to college era, and most I will never wear again.
Thanks!

Adult student
Adult student

I may be the only person here to say that sometimes grad school IS an ok time for lifestyle inflation. My income actually went up in grad school, so yes, I increased my savings heavily, but I also bought more varied foods to cook at home instead of relying so heavily on rice and beans, and started going out to eat a couple times a month instead of never. I think when you’re really living at a level where you feel like you’re constantly on the edge, it would be stupid to stay constantly stressed out or go without basics… Read more »

CYH
CYH

That is interesting that your income actually went up! That makes me hopeful that I can continue to make some of the choices that are important to me. I don’t want to be constantly on the edge, as you put it. I definitely do what a good quality of life, or as good as I will be able to afford. The hard part will be admitting that I won’t be able to save as much from month to month as a result. But from the sense I get from your comments, I’ll have to work at just letting that go.… Read more »

Jenn
Jenn

Thanks for sharing your story, Ellen. I’m a little surprised by the responses you’ve received so far, as I think the process you’re going through is very nearly the opposite of lifestyle inflation, which I think is closely linked with mindless spending. Each of the changes you listed is something you seem to have thought carefully about, and have decided is worth more to you than additional savings.

Brian
Brian

I think that lifestyle inflation happens when you stop conciously evaluating the extra stuff or activities. As long as you have clear goals and the stuff/activities don’t inhibit the goals, then you’re OK. That said, going back to grad school is not time to significantly increase your lifestyle. A few treats here and there, sure, but you won’t be earning a regular check for a few more years, so it’s best to keep the student life as long as possible.

Erica
Erica

“I’ve paid debt down like the last remaining survivor beating back a zombie at the door of the space shuttle to Mars.”

I loved this sentence.

getagrip
getagrip

“When do lifestyle upgrades start to bleed into inflation? How do I make upgrades without getting to that bleeding edge?” Meet your financial and saving goals, whether it’s save 5% or 50% of your salary, putting money away for a trip or for a nicer car, whatever and do it without spending more than you earn. Do that and it isn’t lifestyle inflation, it’s concious spending and upgrading. Too often the message on the PF boards is “If you spend money on anything other than an experience that gives you a feeling of pleasure you must be flogged because you… Read more »

Dorothy
Dorothy

My daughter moved to Mexico and discovered that here US phone was only good for calling the US and the service was very expensive. She also tried getting a local phone with US service and that was very expensive as well. So for months she kept her American phone and had a home phone with a call-out free to US plus she discovered she needed a Mexican cell phone to make local calls. Her communication bills were very high. I would recommend that you wait until you know more about the new location’s phone system before you invest in a… Read more »

Andrew @ She Thinks I'm Cheap
Andrew @ She Thinks I'm Cheap

First of all, congrats on paying down your debt! Now that you have some flexibility, I think it’s best to upgrade your lifestyle in places where you will get the most benefit.

If a smart phone will increase your productivity at work/school/etc then it’s a worthwhile upgrade. If you’ve been spending long hours commuting to work on public transit, getting a car could really increase your quality of life by giving you more time.

You really have to worry about lifestyle inflation if your upgrades exceed your income or if the upgrades don’t provide a substantial benefit.

CYH
CYH

Thanks! I think I might wait on the data plan for a smartphone, as there might be plenty of WiFi available. I think I’ll test the waters during the first month, and try not to freak out!

I feel like I’ve been in PF training for the past few years, and this change will be my first real test. hahaha

FrugalMe
FrugalMe

Great article. I have thought about this as well. After I graduated college and got my first full time job, I called a friend and spoke with him and he asked “So what are you going to buy now that you have a real job? A new car?” I didn’t purchase anything. In my opinion, this is where a lot of people start “lifestyle inflation”. I currently maintain similar spending habits from when I was an undergrad. Your scenario seems similar to someone going on a vacation and they want to buy new and different belongings to use there. I’ve… Read more »

CYH
CYH

Thanks for your advice! I have successfully talked myself out of buying things that I don’t need (camcorder, new sleeping bag). I’m pretty proud of myself for that, and I hope to continue to be smart about things. The biggest concern that is making me fret is that many things (clothes, pots, pans, everything) are quite expensive where I’m going because they have to import everything.

I think the first month will be most challenging because I’ll be so overwhelmed by settling in that I might feel like I need to buy things, that in reality I don’t really need.

MY
MY

It seems to me that you’re either going to Malaysia or Singapore. I live in Malaysia so I’m not too sure about Singapore, but I would suggest waiting to get a phone plan until you get there. It’s much cheaper. I know this because I lived in America for four years. Also, American phones are notorious for being locked so I think it would be an investment if you bought a phone there as you could basically use the phone anywhere in world. It doesn’t even have to be expensive. You can definitely get a decent basic smartphone, just check… Read more »

CYH
CYH

Hey all, just wanted to give an update. I’ve been in my new country of residence for about 4 months now! It has been tough to adjust to having a stricter budget. Although I haven’t figured it all out yet, I’m glad to be able to continue learning through this blog and others! Thanks for all the comments and support and please check out my blog if you get a chance!

shares