Some folks believe earning a higher income is a valid excuse to submit to lifestyle inflation. But I don’t think lifestyle should necessarily be tied to active income because job security is a fickle pickle. However with a strong framework of growing passive income, a little lifestyle inflation is not only acceptable, but I would even recommend it because YOLO. 😀 Due to the recent tailwinds of increasing investment gains and asset prices it appears I’m ahead of schedule by 1 year to reach financial freedom by my 35th birthday. Since my ultimate goal is to live a balanced, resourceful, and meaningful life, I have decided to succumb to lifestyle inflation and increase my expenses.
Changes to my budget:
|Item||Old Monthly Budget||New Monthly Budget|
|Internet + Phone + Entertainment||$75||$100|
Overall I’m now spending $100 per month more than I was back in 2010. This is not a major change to the way I spend money, but it allows me to enjoy the present a little bit more while not sacrificing too much of my financial security in retirement. The way I conduct my budget is I set an expected target, such as my $150/month for groceries. The target is more of a guideline than a strict limitation. Sometimes I spend less, other times I spend more depending on what I buy and how often I eat out.
Here are my thoughts behind the 3 categories.
- Grocery: Since food inflation has been higher than the average consumer price index over the years I’ve decided to increase my grocery bill to $150 per month. Some people might think $150 is not enough, but it all depends on where you shop. A few years ago I blogged about buying some staple foods from Safeway for about $17. That’s enough produce to last me for probably 1 or 2 days. Then I walked half a block down the street to another grocery store and purchased the same food for literally 1/3 of the cost. I’ve uploaded pictures with receipts for proof.
Since it’s been 3 years since writing that article, I think the same basket of goods would probably cost about $20 at a Safeway or equivalent big box store today due to the ever increasing price of food. How much can the same $20 buy at one of the smaller independent stores I go to? Well I recently went to a small grocer to find out. It’s called Persia Foods located in North Vancouver if anyone is curious. Below is a picture of everything I bought. It actually came out to $21.07 but you get the idea. There is enough produce here to last me for an entire week. (click image to enlarge.) I’ve also blogged before where I get cheap meat, other sources of protein, and grains. Last month I bought nearly 4 lbs of ribs in a West Vancouver supermarket for less than $8, and it took me several days to eat through it all. The point is it’s perfectly reasonable to eat well on $35 per week for an individual adult, which works out to $150 per month. Of course if people are buying all their groceries from Safeway then they can expect to pay $300/month or more for essentially the same diet. But that’s their choice. 😛
- Eating Out: By increasing my restaurant budget to $50/month I can spend more time to socialize with friends. 🙂
- Internet + Phone + Entertainment: A couple of things happened here over the last year. I finally upgraded to a smart phone earlier this year. No more flip phone for me lol. So I upgraded my cellular package to include a data plan. I also subscribed to Netflix which is an additional $9/month. So I’m paying $25 more for telecom services now than before.
Every other expense I have such as transportation, insurance, and utilities have surprisingly not gone up in value over the past 5 years. In fact, my auto insurance premium has gone down because I’m a road star now. 😀 I still pay about $25/month for heating and electricity as was always the case, even during the winter. Yay for apartment living. 🙂 Overall my total monthly spending is around $3K.
Random Useless Fact:
Avoiding your problems doesn’t make them go away.
AHH LI! If only you teach these ways to the people on welfare. We would hear less of them not having enough money to live on after they went to the local convenience store for that pound of baloney (need to feed the kids) carton of cigarettes and the lottery tickets and video terminals.
It’s too bad that the people who buy lottery tickets and smokes are often the ones who can least afford them. 😐
I’m already over budget for eating out for this month. Treating others is expensive… Treated my family for Dim Sum for mothers day was $80 (6 people). Then I treated my friend for her birthday ended up $96 at Cactus Club. I’m a frugal person but I am generous to my family and friends. Can’t always be saving and not reward yourself from time to time. I got $ and can afford it so its all about balance.
I went to Cactus Club a couple weeks ago for a co-worker’s going away lunch. Everyone paid for their own meals of course. I always expect to spend at least $20 when I go in there lol. It’s worth it though, at least once in awhile. 🙂 I just got McDonald’s coupons in the mail today. I like the buy one get ones. Thanks for telling me about the Safeway deal btw.
Just couple of thoughts, not directed at you Liquid but just in general. I’ve changed over the years in my “saving money” mantra. It used to be “save money on everything!”, especially when I was single. I’ll save money on cars by driving a 20-year old car, I’ll save money on clothes by wearing same pair of pants every day, and none of the new electronic things will ever be on my shopping list. Overall, me and my wife are quite frugal. But when it comes to food, we just refuse to save money. We have a healthy monthly budget ($600), and the last thing I want to do is to talk my wife into buying less food or food of lesser quality. All of our meat is top grade from Costco. All of our vegetables are local seasonal vegetables from a local market. Both of us love eating animals 😀 Side benefit from it is that we always bring lunches to work, so we save money on eating out. Oh, and BBQ season is here, and that means grilling things! It might be an immigrant thing, but food is kinda a big deal to me. I don’t think I’ll… Read more »
I went to Turkey last year and was also really impressed by how fresh everything was! Bread had to be fresh everyday too. The olives at breakfast were amazing. The tomatoes were so fragrant.
It made me realize that we don’t get fresh food in Canada.
That’s the thing. We don’t get a whole lot of fresh food here in Canada. Ingredients for your meals are trucked for half way around the world. Unless you’re lucky enough to have your own garden – to get the same quality of food you have to pay extra.
Bread is another story. Turkish bread (they use special tandoori ovens) when it’s fresh is absolute heaven.
Interesting observations, FU. 🙂 You can probably write an entire article about the difference in food quality between Canada and other countries. I do think it’s unfortunate how poorly a lot of Canadians eat out of convenience or thrift. There are services like Spud, that will bring a basket of fresh and locally grown organic food to your doorstep for $100/week or more depending on the city. It would be nice to import some cheese and grass fed meats from other countries but Canada has an outdated supply management system that puts expensive tariffs on many foods that come from Europe still.
It’s definitely easy to fall into the fallacy of lifestyle inflation = increased spending. I love eating at restaurants so I’m pretty stuck up here as we only have two places to go (and both are horrible for vegetarians). Being up here has allowed me to live with less … although I’ve accumulated a LOT of fitness and yoga gear the past year 😛 I’m okay with that, because it’s a long-term investment on my health and likes RSPs, you should always start early on that!
I’m also VERY lucky as a Canadian my rent is only $180/month.
As for groceries, I only have three options here: online through IGA, the local Northern Supermarket and the small family-run convenience store. The best option is our once-a-week online orders because they are actually more like city prices; I can afford a bag of $4 avocados even if it means waiting for a week, versus a single avocado, which can be about $3.50 (and not necessarily in the best condition)!
Your rent is cheaper than my building maintenance fees, lol. I shop at my local IGA all the time. They have a good selection of organic foods at affordable prices. 🙂 I love avocados. I make guacamole sometimes. Buying the bags in bulk is the way to go. Patience doesn’t cost anything, but it’s a useful virtue because it allows us to save money.
I know some of your increased expenses may be acceptance to a lifestyle inflation but I think overall, things have gone up in price. For instance, meat and seafood these days seem to be really expensive compared to 5-6 years ago. But I agree with you, to a certain degree, lifestyle inflation is OK (even for a frugal family). 🙂 Our strategy is if we get a bonus, raise, unexpected windfall, etc. 80% still goes towards our goal of early FI, but we do allow ourselves the remaining 20% to simply enjoy some of the finer things in life!
Thanks for sharing…Enjoy the rest of this Mothers Day Weekend! AFFJ
The 80/20 split is a good strategy. I do something similar with any unexpected windfall. 🙂 I recently received $1K in tax refund this year so I’m thinking about buying some more stocks soon.
Food has gone up in price so much. Walnuts I used to buy at Costco for $14.99 3 years ago are now $22.99 and I had to stop buying them. I try to watch prices but everything just seems to go up. I get excited when Shopper’s Drug Mart puts the butter on sale for $2.99 but bargains like that are hard to find.
Smaller cities, like the one I am in, have lower property taxes but we lose out on bargains at ethnic stores when all we have to chose from are the big chains.
I hear the drought in California is causing almond prices to rise pretty dramatically because it takes a lot of water to grow those nuts. Yes, the ethnic stores exist most in urban cities only because they require dense population and high volume of foot traffic and customers in order to survive due to the thinner margins. That’s why it’s often crowded in those stores. We have less people in the country than in the state of California in the U.S. The lack of population density here makes it more costly to ship food and other goods to everyone who needs it. It’s a problem in Canada that’s not easy to fix. Maybe the benefit of a more sprawled out or smaller city is the abundant existence of hobby farms, assuming the climate permits. 🙂
Samething in Toronto as well.
NoFrills stores are own by Lablaws Inc. You could buy exatly same products and brands at NoFrills at almost half-price than Lablaws. But, most people in Toronto visit Lablaws. I have no idea why :d .
Right on. We have the No Frills chain here in Vancouver as well. I can see parallels between the food and banking industries. Tangerine is owned by Scotiabank and offers no fees, free banking. Yet more people still use Scotiabank rather than Tangerine, lol. 😕
I’ve also noticed that ethnic grocery stores are not usually always cheaper but they’ll offer more weekly discounts/sales on produce and meats too. Or at least this is true for Toronto.
Sounds familiar. I’d be interested to visit all the large cities in Canada and compare the prices of similar foods.
I think your increase in these budget categories make sense. 🙂
Paying more for the important things in life when we can afford to is what living is all about. Food is our common ground, a universal experience.
I hustled this weekend. I had a garden of herbs. On Sunday morning, I’ll spend 15 minutes to cut the fresh up. On the way back from temple, I made a stop at my local grocery store, to exchange for some tropical fruits and veggies that I don’t have.
My herb garden have mint, dill, another type Houttuynia cordata (dokudami – blocking poison) and chives. They grow back every single year. I only planted them once. I have a cutting every week until October. I hustled $10/week. 🙂 it’s kind of fun watching the veggie grow up.
I also plant tomatoes, bell pepper, not pepper, etc. I always leave 10-25% out for the wild animals and for the next year seedlings. This I why I can’t live in an apartment that don’t allow veggie planting.
Your experiences from working at a plantation appears to be well utilized. 🙂 That’s cool how you leave some food for the local fauna. You are quite the mother Teresa, caring for both people and hungry animals, lol.
Nah dude, it’s the tradition. It’s wouldn’t be nice the we stole the space from the wildlife and not give anything back.
Plus it’s nice to sit on my porch watching the squirrel picking up my tomato, eats it. Find out that it’s not very pleasant, get another one, do it over and over hihih silly animals. It’s very fun. I get visit from red robin, deer, rabbit, etc.
Food prices have been going up like crazy so adjusting your budget to compensate seems 100% reasonable. Alsoooo I spend like twice as much as you do on groceries (on a *good* month). Grocery stores here are stupid expensive (even the tiny independent ones). I’ve done the comparison shopping and Whole Foods is literally the cheapest place walking distance to my apartment. All that is to say, YOLO bro. Good food is worth the extra cost.
Good quality food is getting harder and harder to come by so I try to get my fix whenever I can. Food is a big part of us. You can tell a lot about someone based on what they eat.
I’d love to have a $150 grocery budget. I managed it last month but my eating out bill made up for it. I find it hard to get below $200 even with my new found love for the local No Frills. You’re doing quite well and a small increase will make up for inflation and food costs rising.
Every food group is getting more expensive these days so I’m trying to meal plan better. 🙂
I’m impressed.. $25/month for heating & electricity?! I must have lived in very inefficient 1 bed/1 bath apartments. What type of smartphone do you have? I’m a Samsung Galaxy lover.. I had S2, now the S4, & I’m hoping to get the S6 in the next year. Last Q.. do you happen to have a detailed post going over your monthly budget? Merely curious.
I pretty much never turn on the baseboard heaters. The only thing I have currently drawing power is the fridge. Also, Vancouver has some of the lowest cost electricity in North America. The company I use B.C. Hydro even sells power to California sometimes.
I have a Galaxy Note 4. Yay, Samsung buddies. 🙂
Here’s an overview of my monthly budget. Numbers are approximate.
Cell phone + internet $100
Interest payment on loans $1400
Fun money $200
You can see my complete budget here from a few years ago.
Some things have changed but my budget today is mostly the same as that. Sorry, but I blurred a lot of the numbers but if you want to know any specifics you can ask me here.
Our costs have definitely gone up. Our mortgage is actually less than our rent, but then there are utilities and repairs. I have to pay a little more for Internet because our previous provider isn’t in this area, and I need a business line, so I pay significantly more than most people for a connection.
There’s definitely been a creep upwards in our convenience food intake, since every penny isn’t being thrown at debt. But I’m trying to lower that slowly over time.
And we now allot ourselves some fun money each month. That’s definitely noticeable.
That’s too bad about your expensive internet provider, but it sounds like you can write off the bill as a business expense. 🙂
[…] Succumbing to Lifestyle Inflation – Freedom Thirty Five Blog, Liquid, years of savings has allowed him to up his spending without cutting into monthly investment […]
Those are pretty nice expenses – and I think you are taking the right approach. LOL at that gif at the end. I wish I could do that with some of my problems 🙂
It’s always important to keep things balanced and ensure you have a healthy balance between saving and spending. It looks like you are making some changes to get back in balance.