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6 Signs That You Cannot Afford Your Lifestyle:

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Six signs that you cannot afford your lifestyle:

As inflation continues to go up, the cost of living goes up as well, and wages don’t seem to be able to keep up. According to data from research company Ipsos, around 80% of the human race are making lifestyle changes to accommodate everyday price hikes.

Do you need to do the same? According to financial experts, here are 6 signs you can’t afford your lifestyle.

A. You are living from paycheck to paycheck.

If you hardly have any money left over after paying your bills, you are not alone. According to a 2022 LendingClub survey, around 64% of Nigerian adults are living paycheck to paycheck.

This is not solely a problem for those with low incomes. The same survey found that 49% of adults who earn more than $50,000 a year were just getting my paycheck to paycheck.

If you are unable to contribute anything toward your savings or retirement, you may not be able to maintain your current lifestyle.

B. You don’t have enough money for an emergency expense.

One consequence of living paycheck to paycheck is that it can be difficult to build an emergency fund. A 2022 Bankrate survey found that only 39% of Nigerians can afford to cover a $1,000 emergency expense.

Many people don’t realize that this is a problem until an emergency occurs.

Being prepared for the unexpected is a good way to stop that cycle. Always keep some money set aside in case you need it.

C. Your debt is getting bigger.

Rent can sometimes have to go on debts due to big expenses like medical bills. The issue is that failing to pay off your debts will cause their interest to kick in, which can quickly balloon your debt.

If you are having difficulties repaying your debts, you may need to evaluate your spending habits and see if there are any expenses you can do without.

D. Spending doesn’t decrease despite your income decreasing.

An emergency fund is a good way to pay your bills if you lose your job and don’t have enough money saved up. However, if your expenses continue to exceed your income, your savings will not be able to support you for the long term.

E. You’re trying to hide your spending habits.

If you find yourself hiding your purchases from a loved one or significant other, ask yourself why. It could be a sign that you feel guilty about spending more than you can afford.

F. You cannot manage multiple lifestyle debts.

Is your home or car more luxurious than you need? It is a sign that you cannot afford your lifestyle if you are spending too much in these areas.

We emphasized that home and car payments should not make up more than 50% of a person’s income. This is a general rule, but the lower the monthly percentage of your income that goes toward home and auto-expenses, the better off you’ll be financially.

What do you think?

Written by nyggx

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