Lifestyle Creep with Cindy Marques

Why is it that our savings stay the same even as our salaries go up? Or that once we’ve hit our dream income, it still feels like we’re living paycheck to paycheck? The answer may be a phenomenon called “lifestyle creep.” On this episode of Half Banked, hosts Cadeem and Bethan sit down with Cindy Marques, financial planner and co-founder of MakeCents, to discuss what lifestyle creep is, why it’s such a problem for young Canadians, and what you can do to avoid falling victim. They also price-check Canadian grocery chains to see if shopping at a fancier store really has a noticeable impact on your bank balance.

Here are three reasons why you should listen to this episode:

1. Discover the different factors affecting the Canadian cost of living.
2. Learn the definition of lifestyle creep and who's most vulnerable to it.
3. Understand the value of financial freedom, and reframe it in a way that suits you.

About Cindy

Cindy Marques started her career in finance after realizing her lack of financial literacy as a recent physics and philosophy graduate. She decided to pursue a postgraduate degree in financial planning, determined to become a successful adult.

Despite feeling lost initially, Cindy leaned in and found her passion in finance, leading to a full pivot in her career. Today, she uses her expertise to empower others to take control of their finances. 

Connect with Cindy through her website, or sign up at MakeCents. You can also contact her through her socials, LinkedIn, Instagram, Facebook, and Twitter.

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Transcript

Cadeem Lalor: Getting your first real job or your first big raise is exciting. You're making more money, you're feeling successful, and you're ready to level up your life.

Bethan Moorcraft: Maybe you decide to ditch your roommates and get a place of your own.

Cadeem: Maybe upgrade your beater car to something slightly less embarrassing.

Bethan: Or maybe, like me, you just order Uber Eats a few more times a week.

Cadeem: You treat yourself because you've earned it.

Bethan: Good job, you.

Cadeem: But then a few months go by, and your new salary doesn't seem to be doing too much for your savings. In fact, your bank balance looks almost the same as it did when you were earning less.

Bethan: If this sounds familiar, you could be experiencing something called lifestyle creep, a gradual increase in your spending when your salary goes up or when you receive a windfall, like an inheritance or a bonus.

Cadeem: Lifestyle creep tends to hit young professionals especially hard. Today on the podcast, we're chatting with Cindy Marques, a certified financial planner, public speaker, and the co-founder and CEO of MakeCents, an organization that offers financial coaching for millennial, and Gen Z Canadians.

Bethan: We'll talk about why younger people are so susceptible to getting crept up on by lifestyle creep, the signs you should watch out for, and what you can do to keep creeps to the curb.

Cadeem: I'm Cadeem Lelor.

Bethan: I'm Bethan Moorcraft.

Cadeem: And this is a Half Banked podcast.

Bethan: So, Cindy, thanks so much for being on the podcast.

Cindy Marques: It's a pleasure to be here. Thank you for having me.

Bethan: It's great to have you on the show. So you're a financial planner and educator who focuses mainly on helping young Canadians. Can you tell us a bit about how you got started and why financial literacy is so important to you?

Cindy: Yeah, I mean, the funny thing is, I got started because I felt like I had no financial literacy myself. I actually went to university studying physics and philosophy, so not finance. And I graduated, and I realized, well, okay, I'm an adult now. I'm supposed to do adult things like manage money. But that was never taught to me. And I know that's changing now they're injecting financial literacy into the Canadian curriculum. But at the time, I felt pretty lost.

So I made the conscious choice to go back and do a postgrad in financial planning because I felt like this is necessary to be a successful adult. So I leaned in, I really liked it, and I just fully pivoted, and my career went to finance.

Bethan: That's awesome. And I think just one comment there is that in other episodes, we've discussed how Cadeem and myself, we didn't have that financial education at school either. So really, it is a learning curve as we get older. And so it's great to hear that people like yourself as well, who we now turn to for advice, had the same experiences.

Cadeem: I think this topic definitely hits close to home. We try to have most of our topics hit close to home, but I think this one especially for people our age. So I wanted to ask you, what do you view some of the most common ways that lifestyle creep creeps up on us?

Cindy: Yeah, I would say that they come in the form of inexpensive conveniences. And you've probably heard the term, “the latte factor” thrown around and it's not necessarily to do with coffee per se. You're not going to bankrupt yourself specifically because you're going to Starbucks. But the latte factor term is coined to describe the impact that all these seemingly small and insignificant purchases have on your cash flow, where on their own they're not very big.

So it's easy to justify the quick spend, but at the end of the week, for example, you're wondering where your paycheck went because you can't actually remember spending any significant amount of money. So with these latte factor type purchases, most of them are made for the sake of providing little conveniences, like an Uber for example, to get to your destination because it's raining or whatever it may be.

It's not this big thing you're spending money on consciously, like going out for dinner or buying groceries or paying a big bill. There are all these fleeting moments that fly under a cash flow radar because we're not really paying attention to them and so we barely notice that we spend the money.

So that's how these things tend to add up. And again, I'm not going to use the usual stigma to say, oh, millennials, it's the avocado toast and that's why we can't buy a house these days. It's this general category of all these small conveniences that we're paying for that tend to add up and we don't think much about it because on their own it's not much.

Cadeem: And I'm guessing, obviously, ordering more takeout, things like that, getting SkipTheDishes a few more times a week than normal, that's kind of one of the big, I guess, culprits.

Cindy: Oh yeah, absolutely. And then all the fees that get added to that, the delivery aspect, tipping a driver, et cetera, it all adds up. I mean, I've been culprit to that too, where I'm really lazy and I want to order on an app and I realize after the cost of the meal I've doubled the total price because of the embedded fees, the delivery, et cetera. But again, in the moment you're lazy.

Cadeem: Absolutely. And then I guess I'm wondering too, why is it that young savers specifically focusing on millennials and Gen Z as well, why are we so susceptible to lifestyle creep?

Cindy: I think this is twofold. The first one, I would say our generations are a bit in a hurry to catch up to our peers or catch up to the standards that are portrayed to us. So we think about back in the day before the internet and social media, we would really look to local standards as a benchmark like our neighbors, individuals who at a minimum grew up in similar surroundings that we can relate to.

We looked at the people around us to set the benchmark of what we aspire to, but now we've got the world at our fingertips and that pool that we're competing with or looking to has expanded to millions of people globally. And so a lot more wealth and affluence is being brought to the forefront in front of our faces.

This goes beyond just famous celebrities. We look at celebrities, okay, that's a little out of touch to compare myself to them, but now I'm seeing all these really rich regular kids that look just like me, and that makes you aspire to that standard. I think we feel the pressure to catch up to that. We're feeling like we're already behind because we're seeing these standards of individuals who look just like us as being so much higher than where we're currently at.

So one is that sense of keeping up with the Joneses. The other one, I think, is a little bit more economical. We are under, I would say, a lot more financial pressure than the cohorts that came before us, where inflation has been insane and has increased quite a bit.

The rate of individuals attending postsecondary education are the highest among these two cohorts, millennials and Gen Z's, but so are the costs associated with attending post secondary school and therefore the debts that we carry. But the salaries haven't really increased at the same pace.

We graduate with this expectation that's been drilled into us by our parents and society in general, that we are definitely going to get a great job if we go through the motions and get this degree, but then we don't. Or it's a lot more competitive, or you spend four years getting this degree, but now your field is kind of made obsolete by an app, for example.

Cadeem: Right.

Cindy: And so after all this, all the debt that we've accumulated and the struggle to get a decent salary to make up for it, there's so little left in our cash flow for discretionary spending that I think that these demographics, anytime they get that extra slack financially, it's hard not to tell ourselves that, okay, I deserve this. I have been grinding to get by, so I deserve this.

So it's two factors. One, we want to be like these standards in front of us. But two, I think we're just really crunched financially that it's easy to justify that, yeah, I do deserve this. I've been struggling.

Bethan: Cindy, I found your point about social media and kind of seeing a lot more wealth and affluence just everywhere really interesting because I find myself looking at friends or peers and we might have the same job and they've got these really elaborate lifestyles and I'm thinking, how do they do that? How important is it for people to kind of check themselves and be a bit more realistic about their budget.

Cindy: It's very important coming from someone who peeks behind the curtain and works with these individuals who have very curated online presences and otherwise exude a certain lifestyle. But then on the back end, I see, oh my goodness, you are very riddled in debt. Not all is what it seems, to your point earlier about having to take on debt to keep up with certain lifestyles.

That happens very often, but you also don't know the level of support that they receive. I work with many millennials, of course, who you're feeling very guilty about being behind. Oh, I don't have a property yet, but so and so just bought a house. They're starting a family. Why aren't I able to do that?

But then that person might have the support of their parents who were very generous and supportive to provide a good chunk of that down payment, or a very supportive spouse or partner to help with the cost of all this. So it's not to say that individuals aren't self made, but not everything is as it seems. You don't know their circumstances and what led them to the point to have what they have. You can't compare yourself to that.

And I know it's hard to check yourself. It is. None of what I'm saying is going to make that easy. But coming from someone who often sees behind the curtain, everyone's story is very different. And how they end up there, it's never a straight line and there's usually a lot of support or five steps backwards in the form of taking on debt to achieve these things.

Bethan: So for a lot of people, the point of making more money is to be able to spend more money and have more disposable income. So what's the difference between lifestyle creep and just achieving that goal of earning a higher salary?

Cindy: That's a really great question. Okay, so earning more money is, of course, a great goal to have. We do need money to do the things we want to do and live a decent life. That's without a doubt. But I would say to this, richness and wealthy are two different concepts, similar but distinct.

Richness is what you can see outwardly, the things that you buy. So being able to buy that house, that expensive car to go on that trip, sure, that person is rich, they probably have a lot of money to do. So you need a lot of money to do those things. You need to be rich to afford to make certain purchases.

But wealth is what you don't see. Wealth represents the money that you've earned but have not spent. So richness, you earn a lot of money and you're spending it, and everyone can see that. But wealth, you may be earning a lot of money, but you're not spending it. You're accumulating assets. So there are many high earning individuals who are rich, can afford that five star resort but not wealthy.

Once that income stops, if they lost their job, they have nothing left to fall back on. That's lifestyle creep. So a lottery winner, for example, who was never really good at managing their money and then comes into this big windfall, becomes rich very quickly all of a sudden, and then spends very richly. But unless they're saving a good chunk of that and setting aside, they're never going to be wealthy.

And so a lot of lottery winners actually do end up right back where they started because they quickly spend everything that they received and now there's nothing left. And this happens also with professional athletes who get paid insane amounts of money for a very short period of time.

An athlete's career is not actually that long in the grand scheme of things. By the time you're 40, physically, you're not capable of doing the things you could do at 20, for example. And so that income runs dry. And if you haven't saved a lot of it, if you've just been living at that same rich standard that you are being paid in your heyday, that richness stops the moment the income stops and doesn't represent any significant level of wealth.

So, long story short here, aiming for a higher salary so that you can maintain your current standard of living but increase your savings and ability to accumulate assets, that's the goal here. But aiming to increase your income for the sake of just buying more expensive stuff, that's lifestyle creep. You're falling into the trap of being rich but not wealthy.

Cadeem: I guess there's another thing that just that kind of brings up for me too, because we touched on FOMO then. I'm also wondering, instead of, look, when you're looking at people online who may or may not be friends, but how about, I guess, peer pressure, have you found that that tends to impact lifestyle creep? Like if your friends are going out more, do you want to go out more too, and that kind of thing?

Cindy: Oh, yeah, it's very hard to say no when everyone around you is doing a certain thing. And again, these are your peers. You want to fit in. So it's hard to say no.

And I actually saw this come up during the pandemic as well. I think that for many of my clients, lifestyle creep was put into check because they quickly realized, oh, I don't actually have to spend a lot of money to get by. I can just feel really happy with being able to go out for a walk and what a lovely day. I didn't have to spend money, but that's because everyone was locked in their houses, there was no FOMO putting pressure on you.

You really came to appreciate that time in the park without spending money because you couldn't go out to the bar or to a restaurant or to the malls, et cetera. And so for a lot of people, they had this opportunity to finally wrap their heads around what their basic minimum cost of living was like, what is that minimum I need to earn to pay the bills and do the things I need to do. And then all the rest is discretionary.

I think a lot of people realize, wow, I was spending a lot of my spending was on all of these discretionary items. So for many of my clients, that sort of, I want to say, gratitude for what you have and realization of the things you need carried a bit into 2021. But once the world started to open up again, that FOMO quickly changed things. And suddenly that gratitude is like, yeah, that's all well and good, but what I really want is to sit on a patio and have those drinks, et cetera.

So FOMO is a big factor here, and we are social creatures, right? We want to be with the people around us and not everyone is willing to be crafty about how they spend time together without spending too much money. A lot of the social things we do involve spending money to do those things.

Cadeem: Absolutely. Because I remember there are statistics on how much people were able to kind of repay in debt during lockdown, because that was just a key time. You can't really spend it on anything. You start to realize how much money you were spending that wasn't really necessary.

Cindy: Yeah.

Cadeem: Also looking at that, though, afterwards, we have what they call revenge spending. And I think I've definitely been guilty of this too. You want to get back out there, patios, a bit of traveling, even within Canada and so forth. You're just looking for things to spend it on that you couldn't for a long while.

Cindy: Yeah, revenge spending, I like that.

Bethan: Yeah, I've never heard that before.

Cindy: Society took it away from us, and when society opens up again, we're like, screw it, here I come.

Bethan: So, Cindy, what would you say are some of the telltale signs of lifestyle creep to watch out for?

Cindy: Yeah, I would say especially for those who are trying to make a conscious effort to change things with their cash flow. They're trying to cut costs or they're freelancing to earn more money. Whatever it is you're doing that is ultimately intended to free up or increase available cash flow. If that doesn't materialize, then clearly something is going wrong here. There was some level of lifestyle creep happening here.

If you've done all the things to free up this alleged extra cash flow you're supposed to have, but then you don't end up with that extra cash flow, well, something has gone awry. So I see this often, for example, individuals who are younger adults who are maybe quick to move out on their own, they want that level of independence, and then they quickly realize, like, oh my God, living in the city is so expensive.

At some point they're just not able to make ends meet. And so they swallow their pride, they move home with their parents, and they no longer pay rent. Well, you think about what typical rent is. In Toronto, for example, close to 2000 a month, if you're living on your own. You move home with your parents, you should have $2,000 a month now that you can set aside for your goals or for anything else that you're aiming to achieve. But in many of these cases, these people come back to me. I'm like, I don't know what happened. I am still living paycheck to paycheck. Where did that $2,000 go?

So, again, in summary, if you're consciously making an effort to change things in your scenario and you're not seeing that materialize, lifestyle creep has probably happened in one form or another. So you really need to dive in and look at your numbers to see where it all went wrong. Definitely.

Bethan: And that actually ties in really nicely to the next part of our show, where we're all going to fess up some of our own experiences with lifestyle creep. Goodim. Do you want to go first?

Cadeem: Not really, but I'll give it a try to start off, I guess the ones that kind of come to top of my mind, I think obviously going out more, ordering in more sometimes. Definitely been guilty of that. I think also be able to get a house. And as you mentioned before, we had some family support for that, which helped.

But then I guess once you're actually in the house too, there's just things that happen that you kind of have no control over financially, such as we had to get some wiring in the basement redone. I'm not handy, so I'm not touching that. We have to pay someone to do that and then washer and dryer broke, so get a new one for that too. And that's within, like, six months of moving in, so that that pops up.

And then also other expenses, the things you don't think about when you're either renting an apartment or with your parents, like, okay, you got to buy a lawnmower, buy a snowblower, get salt and gardening tools, all those other things that definitely add up.

Cindy: Yeah, that's a really good point about the house and everything that comes with it. You'd say that, oh, those unexpected expenses aren't necessarily lifestyle creep. Well, you got the extra income and you feel like, okay, now I'm ready to buy the house. That sort of is part of the lifestyle creep.

Cadeem: Absolutely.

Cindy: But then when you don't consider that buffer, you don't bake in some pessimism and margin for error of what can go wrong, then that's part of the lifestyle creep. You took on this enormous choice to buy a home without being prepared for, oh, I should probably assume that everything could go wrong.

Cadeem: Yeah, basically. I'll know that hopefully for next time if I get another one. So how about you?

Cindy: For me. Cadeem, you mentioned this earlier with personal care. So for a very long time, I was self employed. My income was kind of all over the place. I was behaving a lot more conservatively with my actions. But then when I picked up a salaried role, that's when I was like, okay, I've hit X salary. I'm going to be comfortable now. Surely I should never want anything more than this.

So I started to justify things like, oh, yes, I should take care of myself, so I'm not going to feel guilty on what I spend for personal care and fitness and dining out. So I started to get a lot more massages and chiro beyond what my benefits covered because, oh, my body is my greatest asset. Surely I shouldn't feel guilty about taking care of myself and dining out. I'm like, oh, well, I've hit X figures in my salary. I earned this, and it runs away from you.

And then my previous mindset of being super conservative because I never knew what next month was going to bring in terms of my income because it was all over the place: that left and I just got really comfortable with this level of consistency, knowing that the paycheck was coming regardless, so I don't have to worry so much. Yeah. And that really ran away from me.

I've had to go back and adjust my cash flow many times and humble myself and be like, okay, Cindy, you can't have it all. You can have a lot more than you used to have, but you can't have it all. Yet. If it's important for future Cindy to have the things that she wants, which I would say is important, and realizing what it costs to get there, I'm like, okay, present Cindy needs to slow her roll.

Cadeem: I will say, too, that in terms of the debt piece, I feel like when you have a steady income and you know exactly how much you're getting paid, I feel like you're more willing to take on a bit of debt. If you, say, do a trip, go a bit overboard, you're like, I can balance it out over this next month or so. But obviously with the self employed option, you might not have that option. And so I think it definitely just makes you a bit more carefree sometimes for spending on things that aren't a necessity. And Bethan. How about you?

Bethan: So I'm going to give myself away here, but maybe I'm behind on the lingo. But when you said latte factor earlier, number one: made me laugh. But number two, I was like, I have noticed that in Canada.

So when I first moved here, I was shocked at how my peers used to go to the coffee chain across the street, buy a latte, it might be $3 a day, they might get two, which is $6 a day, and they're spending that just like the amount that it builds up over time. I was just shocked at how much people spend on coffee. That would be my one point. And then I guess, I mean, as a Brit, I quite like instant coffee anyway, so I can avoid that one.

But then the other thing, I think as I've started to earn more, definitely changed my spending in terms of groceries. I'm more willing these days to go to a high end grocery store for higher quality food. Meat, for example. I find it makes a big difference if you go to a higher end grocery store than a basic or budget store. So things like that.

I've definitely changed my habits around as I've earned more money. But yeah, I definitely didn't do that as a student, so I don't think anyone does. The grocery store thing might not seem like that big of a deal, but it does really add up in terms of costs. To demonstrate this, we prepared a little segment called budget, baseline and booty.

Cadeem: So we want to get your thoughts on this. So we want to see what the price difference would be for a standard meal for two to four people if we bought the ingredients at a Budget grocery store, a baseline grocery store or a boujee grocery store.

Bethan: So since we don't want to get sued, we're not going to say the actual names of the stores we've price checked for the experiment. But for reference, budget would be something like a cheaper No Frills or Food Basics. Baseline is the average grocery store, like a Metro or Loblaws. And bougie would be something a bit more fancy like Whole Foods.

Cadeem: So we had on our shopping list a salmon fillet, a bag of potatoes, some asparagus, a lemon, head of lettuce, a bottle of caesar salad dressing, a baguette and one container of Haagen-Dazs.

Bethan: It's quite the feast. So obviously we expected there would be a price difference between the three stores that we visited, but we didn't quite realize just how much of a difference there would be.

Cadeem: So the total for our ingredients at the budget store was $34.16, for the baseline store is $47.12, for the bougie store, $73.32. So 38% difference between budget and baseline, 55% between baseline and bougie, and 114% between budget and bougie.

Cindy: That's wild. That's a huge difference. And it just goes to show some of the items, I'm a budget grocery store girl all the way. It's just one of those things where I can't really justify, especially the things in the middle aisles, which are all in jars or in boxes in containers. It's not fresh produce or meats. I get that there is a difference in quality there.

But when it's a jar of sauce, the same jar of sauce in one store versus the other, I just can't wrap my heads around the price difference. So I'm a budget grocery store babe all the way. And that is a wild difference between the budget and bougie.

Cadeem: I think especially now it's become a big issue with how much grocery store prices there has been inflation. But people sometimes, I think there's been a lot of research into how some of the prices might not necessarily reflect the regular rate of inflation, how grocery stores are actually raking in some more profit. So this has been kind of like a hot button issue, especially because it's such an important expenditure

 Like you do have to get groceries. And I feel like maybe a lifestyle creep thing again where maybe being a bit too frivolous with it is I used to I was willing to go on a longer bus ride, longer drive to get to a cheaper grocery store. Now I kind of just go to the one that's close by. But maybe it is worth looking into. Kind of like trying to take a budget of how much you actually spend on the things you regularly buy and looking at is it possible to get those things somewhere cheaper?

Cindy: But that's even a good point though about spending more of your time to save some money because your time is a valuable asset too. And I'm going to deviate from groceries now and sort of dive back into real estate. Individuals who work and operate and primarily their daily activities are in the city. They can't afford a home in the city, they want a house. So they move to the suburbs to buy what they can afford.

But now they have this really long commute and the amount of money that they're spending on additional gas, on the wear and tear on their car and the hours of their day that disappear get eaten up by this. Some cases you end up actually spending more by having spent less on that cheaper property than just committing to the fact that you know what, my whole life and lifestyle is in the city. I accept that it does cost more to live in the city, but at the end of the day I might actually spend less in terms of my time as well and possibly money to just stay in the city.

So as we get older, as I get older, I am starting to value my time more than just a couple of dollars difference. Where I used to go out of my way sometimes to save a buck. Now it's just like, you know what, it's a time saver to just spend that extra dollar or two. But I make that conscious decision to do so and I recognize that and I accept the extra charge and be like this is a fee for my convenience and I'll pay that fee.

But you got to bake that into your lifestyle as well. Yeah. So it's a balancing act.

Cadeem: No, absolutely. And I guess I'm wondering so we've talked about the things to look out for and so forth. So we're looking at it from more of a preventative side. How do we kind of stop this from happening? Or how do you kind of check it when you can in order to kind of improve and move from there.

Cindy: At the end of the day, you have to look at your numbers. I feel like I harp on this often, but it really is the fundamentals of things. You have to create some semblance of a budget and a cash flow tracker. So you need to pay attention to what you're spending, track that and compare it to how you thought things would go. You should be reviewing your recurring expenses, especially as that often gets overlooked.

Things like those subscription services that are very cheap and they add up. Yeah, whatever. What's $20 a month? But then in the grand scheme of things, I think a lot of these services, too, bank on the fact that once we buy in, we're lazy by nature and we probably won't go out of our way to opt out because again, we just see it as like, what's, $10 a month? It's not going to bankrupt me, but that gets overlooked and it really does add up.

And I would say finally making a point of reassessing your goals on an annual basis at least, and reassessing what it takes to get there. So my standard for my retirement has changed, and I realized that I need to save a lot more for it than what I thought I would need to when I perhaps had a smaller ideal. Just like a minimum baseline I just couldn't even perceive of myself being able to have more than that. So I set my sight small, but now I've got a little bit of a bigger appetite and I realize, okay, it's going to take a lot more to get there.

So even though my income has increased over the year, my available money for present Cindy actually has not changed because I realize future Cindy needs all that extra income that I've earned. And again, I said this before, if I believe that future Cindy deserves that money and I care about what she gets, which I do, then Present Cindy needs to sort of check herself.

I wouldn't have been able to do that unless I was actually crunching the numbers and spelling all this out in a quantitative way.

Cadeem: And not to interrupt you, but just because you mentioned retirement, too, thinking millennials, gen z. Maybe they're thinking they don't need to think about that yet and maybe might not have a detailed outline of what they're going to do day to day when they're retired. But it is something to think about, though, at this age, though, is what you're saying for sure.

Cindy: Yeah. And I mean, I say retirement because it's the easy word to understand, but really this is more a matter of finding freedom. That financial freedom. I don't actually think retirement to me doesn't mean that I'm going to stop working and just sail away on a boat. I don't think I'll be able to stay idle.

I'll still want to do things. It's just at what point do I have enough wealth, not richness, but wealth, accumulated wealth, to have the freedom of being able to decide what to do with my time. And I think that's true wealth, is getting to the point where you have absolute control over your day and your hours, where I can do anything and I don't have to worry about financial roadblocks, that are going to stop me from doing that.

So that's what I've been chasing after is financial freedom, which doesn't necessarily mean retirement. It doesn't necessarily have to do with no longer working or reaching an old age. I can reach financial freedom maybe in my 40s or in my 0s, I don't know.

But again, it's a sense of freedom. At what point do I feel like I'm going to have enough wealth where I don't necessarily have to earn a single dollar more of income? I probably will because I don't want to be idle, but that's what I'm chasing after.

I think a lot of people, when you phrase it that way, especially these demographics, millennials and Gen Z can resonate that because I think these cohorts have put stronger emphasis and priorities on prioritizing happiness and not just sitting at a cubicle and grinding away because they're supposed to.

We are not here to live to work. We want to work so that we can live well. And work is just a means to live well. So thinking about it as financial freedom maybe will change your desire to prioritize hitting that goal instead of framing it as retirement. Like, oh, that's an old person thing. Financial freedom can happen at any point in your life, the sooner the better.

Cadeem: Of course, for sure.

Bethan: I think that financial freedom point is interesting. For me that feels like it could possibly be a long way off, but then I have a lot of financial goals. One day I would love to own a house, for example. So for me, and maybe for some other young people as well, it's about having the freedom to kind of hit some of those earlier goals as well as you work towards that wider goal of complete financial freedom.

Like you said, it's kind of like figuring out your priorities, working towards goals and kind of budgeting and checking yourself along the way, looking after your future self. So yeah, it's really interesting.

Cadeem: As we touch on the freedom piece because obviously a big piece of that, that a lot of people our age I think bring up is investing. We have a lot of crypto bros and so forth who are out there giving different advice on different schemes.

But do you have any sort of general advice on the investing piece? Because that is something I feel like that resonates so much with people when you say financial freedom. It seems to be like an essential piece of the puzzle that everyone wants to understand better.

Cindy: Yeah, you know what? In the long term, the way the math works out is that it's the boring and inactive passive investors that end up winning at the end of things. Like a lot of the time spending hours of research to pick these hot stocks or whatever, going all in on a certain cryptocurrency, it's first of all riddled with risk to put all your eggs in one basket.

But investing doesn't have to be difficult. And for the most part, great wealth is achieved doing the boring stuff, the regular low cost ETF portfolios, for example, and just holding and not panicking, which is easier said than done, but not panicking during downturns and just riding the waves. Because if you look at it from a very short time frame, okay, the odds are less likely that you might end the year off at a gain versus how you started the year.

But when you stretch that out to a time span of like ten years or 20 years, it's 90% plus of the times you'll be in a better off position. So in the long run, of course, time is on your side here. But it's just the smooth, steady, Eddie boring investing that is going to get you that wealth. It doesn't have to be complicated. There are a lot of online platforms now that take the burden of research and stock picking and portfolio building out of your hands, and that is entirely sufficient.

I think many people feel like they're not doing enough because you're like, oh, I feel like this should be more complicated, I should be doing research or whatever. But you know what? The truth is those platforms, they walk you through what your risk tolerance is and they build something that is perfectly suitable for you and that's fine. Just add money and then wait.

Cadeem: So patience is key. I like that.

Bethan: And it's okay to be boring.

Cindy: It's ideal.

Bethan: Well, Cindy, thank you so much. It's been such an interesting conversation. Do you have anything else final to add? Final comments on this topic of lifestyle creep before we wrap?

Cindy: At the end of the day, I would just say be intentional with your money and what you're setting out to do, because you don't need to be in a position of earning a higher income to experience lifestyle creep. It can happen just by virtue of certain expenses disappear and now you have more cash flow and you have the opportunity to do the things you weren't able to do before.

But if you're not intentional about redirecting your efforts and spending your money in a very conscious way, nothing's ever going to change. You're always going to feel like you're in that paycheck to paycheck position. So it all boils down to pay attention to your numbers and be intentional about what you're setting out to achieve.

Cadeem: Thank you very much.

Cindy: Thank you all. Pleasure to be here.

Cadeem: Well, that's another episode of the Half Banked podcast. How are you feeling about your lifestyle after that discussion with Cindy?

Bethan: I'm feeling good. I learned a lot of lessons, I think, actually, about drowning out the noise, the importance of checking yourself and that kind of working towards financial freedom. That really resonated with me. So, yeah, definitely ready to cut out the creep. How about you?

Cadeem: I actually feel inspired. I will not lie. So I think for me, I want to get more serious about budgeting, and I have started investing just conservatively, kind of online platform, small amounts and so forth.

I think I feel more justified in that approach now that she's mentioned that over time, with time on your side, that is actually one of the best ways to do it. So I feel definitely motivated now about getting to financial freedom. So thanks again to Cindy Marques for being on the podcast. You can find her online at. That makes sense.

Bethan: If you like this episode, be sure to subscribe rate and review us on Apple, Spotify, or wherever. You're listening to this podcast.

Cadeem: Special thanks to executive producer Samantha Emann and producers Kevin Hamilton, Jenny Potter, Shane Murphy, James Battiston, Marie Alcober and technical producer Mohammed Tabish. This episode was edited by Lead Podcasting.