Lifestyle Creep and Travel Hacking

Two new videos up! Watch below and if you are in space where you can’t watch, the transcripts are available as well.

I’ve had countless financial therapy clients who are making BANK on paper, but are still living paycheck-to-paycheck. If you are technically making good money or you've been getting raises but you still feel like you're having a hard time figuring out where that money goes or feeling like you have a hard time making ends meet, you might be falling victim to something called lifestyle creep.

I shared a post on this topic on The Middle Edit, a site for women in their  30s and it got great feedback so I wanted to share it with you here. The link for that post is here.

Lifestyle creep is what happens when you start making more money and start subsequently spending more money. This happens gradually as we get raises or bonuses. Maybe you and your partner used to do date nights once a month at a nice restaurant and then once you got a raise, you found yourself on date nights weekly. Another example is going to purchase a new car (or new for you that is preowned) and looking in the next band of pricing instead of your current band of pricing.

You feel like you're saving and spending more money in a way that feels good to you easy I want you to First plan it out. Write down or put this on your phone. What would your dream be if you had a bit more money? Ask yourself, “What would I do if i had an extra 2 or 5 or 10 thousand dollars land in my lap?” Would you upgrade your house or take a vacation? So once you get that raise or bonus, go back to that dream and see if your raise can fund it. Even better if there is money leftover afterward! You can throw that towards saving or investing in your retirement. So this is how you mindfully, intentionally plan to save and spend your money so you don’t fall victim to lifestyle creep.

If you wanna travel but you feel like it is out of reach for you financially, I’m going to show you something called travel hacking so you can travel for pennies on the dollar. Today’s video is a little outside of the realm of the type of content I usually publish, but I put this on my Instagram stories and got a lot of comments, questions, and feedback so I want. I got asked for more information about how I travel hack. In this video, I’ll show you the exact breakdown of how I took my partner and I to Europe in 2016 for a 20,000 dollar vacation and paid under 800 dollars out of pocket for it.

First things first. Travel hacking relies on credit cards. It does not mean I want you to rack up debt or carry a credit card balance. This is ONLY for people who are organized financially, who are in good standing with their credit and have a good credit score, and know that opening up a credit card won’t tempt them to spend more than they can safely pay off. If that is not you, I want you to hit pause and bounce out of this video because this information is not for you.  

Now that we got that out of the way, let me show you exactly how that trip broke down. I’m going to hop over to my computer and show you the spreadsheet that tracked how I did everything.

This is the actual spreadsheet where I put everything. In this column what we were purchasing, the second column is what things cost in retail in 2016, this one is what we paid whether it was taxes or fees, and this one is what types of points we used or redeemed. So I’ll just go through a couple so you can see what I’m talking about. On this first line we flew from Detroit to London Heathrow on business class and it cost $8,100 dollars retail, we paid $11 in fees, and it cost us 100 thousand American Airlines miles to do that. We went to London for several nights and the Edwardian Vanderbilt Hotel and it cost $1,300 retail and we paid zero. And we used 150 thousand Club Carlson points. You can see how that broke down.

I really get excited when I total everything up and what it came down to is the total cost of the trip was almost twenty thousand dollars but we ended up paying about seven hundred sixty-four so when you break it up we paid 4% of the retail cost. So that is how we did it so now I’ll hop back over to how the heck you get all these points.

Almost every credit card issuer is going to offer a card that offers some sort of reward. Some of them are cash back, some of them are for things like frequent flier miles, and some of them are more general rewards points like Chase Ultimate Rewards or American Express Membership points. What you do is sign up for a credit card that has a sign-up bonus. Make sure to read the fine print. Usually, there is something called a minimum spend. That is the amount of money you have to spend in a certain amount of time on that credit card in order to get that sign up bonus. For some of them, it's spending three thousand dollars, for some its one thousand dollars. To meet minimum spend, I like to put a charge on the card that is large and something I’d have to pay anyway. An example would be putting six months of car insurance on a card to meet the minimum spend, then pay it off right away. So that’s how I did it several times over. I’ve put some of my favorite cards below that you can check out.

The other thing is that I’m getting ready to take another Euro trip on points with my partner this summer. If you’re interested in learning more about that or seeing that points breakdown, be sure to hit the thumbs up on the video so I’ll know to make a video on this summer’s trip to Amsterdam and Berlin.

If you are interested in getting started, here are some cards with low-to-no annual fees that you can check out. These may be affiliate links, meaning I may be paid or earn points at no additional cost to you if you click through.

Chase Freedom Unlimited: Earn $150 bonus with Chase Freedom Unlimited if approved.

Chase World of Hyatt: Earn up to 50,000 bonus points with the World of Hyatt Credit Card if approved.

American Express Preferred Everyday: Earn 20,000 Membership Rewards Points if approved and you meet the minimum spend requirement!

American Express Blue Cash Everyday: Earn a $200 statement credit if approved and you meet minimum spend requirement!

American Express Platinum Delta Skymiles: Earn 75,000 Delta Skymiles if you are approved with this link and you meet minimum spend requirements!

American Express Simply Cash Business: Apply for an American Express Card with this link. Earn a $250 statement credit if approved and you meet minimum spend requirements!

The information and content provided by Lindsay Bryan-Podvin LMSW, LLC/Mind Money Balance is for informational purposes only. It should not be considered legal or financial advice. You should consult with an attorney or other professional to determine what may be best for your individual needs. No one should make any investment changes without first consulting his or her financial advisor and conducting his or her research and due diligence. To the maximum extent permitted by law, Lindsay Bryan-Podvin LMSW, LLC/Mind Money Balance disclaims any and all liability in the event any information, opinions, advice and/or recommendations prove to be inaccurate, incomplete or unreliable, or result in any investment or other losses.