What is lifestyle inflation?
Lifestyle inflation is the idea that even as we, potentially, make more income, our cost of living somehow matches or exceeds that increase such that we never seem to have enough money. This idea is associated with moving up the ladder and getting promoted, but I suspect the problem can start in college where the idea of “roughing it” seems to be disappearing for some students.
Is college lifestyle inflation a problem?
Last week, I answered what are the hidden costs in college. Many of these items are what I would classify as luxuries.
Let’s start with your computer. A laptop is not a necessity for most colleges; at our university there are plenty of computer labs with desktop machines, the library is full of terminals, and the library even lends out laptops (both Mac and PCs). The question might then be, is the software needed for your class and project work available on these devices? I teach and use a very dedicated type of software (Quartus for FPGA design). I know this software is available in all our labs, and therefore, I suspect that most software that is used in a course will be available.
The laptop, however, is convenient and something like 60% of students will buy a new laptop when they enter college. Just so you are aware, the computation power, memory, and storage space on almost any modern laptop is much greater than what you will need for the entire four years – unless you are playing video games, designing and running complex simulations, or rendering 3D landscapes. The difference between the low-end and high-end laptop from the perspective of surfing the web, word processing, spreadsheets, and basic design (such as programming) will all run fine on the low-end machine. So save your money.
In many ways, college is about experiencing that first step into adulthood. In that experience, I believe that you should make your furniture out of milk-crates, and you should visit the thrift store to find a t-shirt with some interesting vintage logo. I suspect that many students think that college life should be as comfortable as their lives with their parents. Based on this, that means even before you get your first paycheck, your living level is starting at the same level as your parents (who are making a living and have already struggled to afford some of our commercial worlds nicer things). Lifestyle inflation will crush these future graduates if they stay at this level – cue consumer debt.
Multi-generation Lifestyle Inflation
That title above is my new name for this potential problem. College should be a little bit of a struggle and that means lowering your lifestyle standards. In the worst case, you should have to choose between the fancy coffee or matching lampshade, curtains, and duvet. To help you in your consumer life, the stoics used negative visualization to prevent hedonic adaptation. Good luck.