The objective of this article is to shed light on the one of the mistakes many business people make which results in a negative impact on their business or individual lives.
This article is not only meant for the consumption business people but also for individuals who are seeking ways to improve their financial literacy in order to gain financial independence.
What is Lifestyle Inflation?
Lifestyle Inflation simply means a rise in your expenditure as your revenue rises. This is to say that as your revenue is increasing so do your expenses.
As an individual or a business person, lifestyle inflation can really cause damage in your financial life.
There are financial commitments people start making that lands them in lifestyle inflation.
Purchasing non-essential items, moving into a new apartment because a certain amount of money entered your account etc.
Lifestyle Inflation has rendered many enterprising individuals or businesses to 0² because of bad financial choices.
Lifestyle Inflation can land people in bad debt as an individual or business.
Lifestyle Inflation can cause your business to face challenges of liquidation.
Lifestyle Inflation can cause a business to owe workers salary because the company is broke.
Lifestyle Inflation can hinder your business from venturing into potential business deals because the company is bleeding from expenses.
How can you keep yourself in check to prevent lifestyle Inflation?
Whenever a huge amount of money enters your account, there is a sudden need to buy this or buy that. There is this urge to spend and spend. To buy shoes, clothes , get a car etc, please slow it down. That's lifestyle Inflation trying to gain expression.
If you allow it, it usually ends in regrets but if you're able to control such influence, you'd be amazed at the ruin you've saved yourself from.
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