As you enter your 30s and begin to consider marriage, buying a home, or having a kid, it’s more important than ever to get your financial house in order.
But as your friends (and foes) begin reaching these milestones, it can be tempting to try and keep up, even if you know you can’t afford it or their goals don’t align with yours.
“[S]ometimes that becomes harder in your 30s and 40s when you see all your friends buying a nicer house or nice car, and you start thinking, ‘Well why am I not doing that?'” Katie Brewer, a Dallas-based CFP and founder of Your Richest Life, told Business Insider.
“I always refer to it as ‘lifestyle creep’ because one of the big things that people can do — that’s an advantage to them — is keep their fixed expenses somewhat stable and reasonable for what they make,” she said, referring to monthly or annual expenses like mortgage or rent, a car payment, and insurance, for example.
Planning for your recurring costs ensures that expenses won’t creep up on you and derail your financial future.
Brewer says that working on stabilizing fixed expenses is something she regularly helps her 30-something clients with, many of which are working couples and couples preparing for kids.
Of course, Brewer said, if you’re making good money you should have the freedom to spend it how you wish, as long as your lifestyle doesn’t overtake your income.
“I think there’s a really good balance between taking some of that [money] and putting it toward your long term goals and taking some of it and putting it toward your short term goals,” she said. “And people can do both, it’s not an either or, but that’s something that really makes a healthy financial future.”