Often when Americans travel abroad, they see people living with less. It highlights how bloated our lifestyles are back home. But, what some travelers don’t realize is that lifestyle inflation is not a uniquely American phenomenon. It is totally global. I’ve had the chance to live in Bolivia in South America this year, and I see signs of lifestyle inflation and lifestyle creep everywhere. And it completely changed my perspective!
What Is Lifestyle Inflation?
First, what exactly is lifestyle inflation, or lifestyle creep? Investopedia defines it as “a situation where people’s lifestyle or standard of living improves as their discretionary income rises…. As lifestyle creep occurs, and more money is spent on lifestyle, former luxuries are now considered necessities.”
But let’s go back for a moment and focus on a few words from that definition: “former luxuries are now considered necessities“… Well, today some things that have long been considered necessities by most folks in America are still considered luxuries by many in Latin America. Are they luxuries or are they necessities? That depends entirely on your frame of reference.
Lifestyle Inflation In Latin America
In the U.S., lifestyle creep means larger houses, cars that drive for you, refrigerators you can talk to, and faucets with touch switches. Lifestyle inflation in Latin America happens too. But it’s at a different level – or perhaps starting from a different base. Here are some examples:
A TV in Every House
Today, it seems there is a TV in most households in Bolivia! Contrast that with twenty years ago, when personal TVs were pretty rare. Even in rural areas where few signals exist, people have TVs today. If you have money, you may even have cable!
To Americans, TVs are a necessity. They are one of the most ubiquitous forms of entertainment around. Even as cord cutters are now beginning to rely on alternative screens, there is still more than 2 TVs per household in the U.S., on average.
But in Bolivia, they are still a luxury. Latin America is just further back on that lifestyle inflation curve.
A Phone Too
Cellphones have taken the whole world by storm in the last decade. But, the difference in Bolivia is that most houses did not have telephones at all before the rise of the cellphone. So, a cellphone in every pocket now means a phone in every house too!
Just a few years ago, there was a telephone company with public pay phones in every town. It was the only way you could communicate to people in another city or country. As late as 2005, the village I’m currently living in had only one (1) phone line, shared for the entire town. Today, most telephone company offices around the country are closed up and out of business. The one in our town turned into a game room for pre-teen boys.
You may think that having your own phone is a basic necessity – you may even call it a “utility”. But in Bolivia it’s rather recent lifestyle inflation!
Do you remember what your parents’ refrigerator was like growing up? I do. I can’t say that the one I have in my house in California today is really much better. Maybe it’s a bit bigger, and it’s got stainless steel, which is so chic. Refrigerators have been a fixation in American kitchens for decades. Can you even imagine a kitchen without one?
Just twenty years ago here in Bolivia, refrigerators were a very rare thing indeed, unless perhaps you owned a restaurant. Personal refrigerators were a true luxury, not found beyond the wealthiest households.
Not any more. It seems today that most houses have refrigerators – even in the remotest villages. If there’s electricity, then there’s probably a refrigerator. While Americans are starting to talk to their refrigerators, or filling a second one just made for wine, and maybe getting a third for the garage, Bolivians are still just happy to have a fridge.
Do you consider refrigerators a luxury or a necessity?
This one surprised me to see this year. Generally, most people in Bolivia still wash clothes by hand. With labor so cheap, even if you hire the work out, it’s much cheaper than buying a washing machine. Here’s my wife drying some clothes in our backyard:
But, more and more households in Bolivia now have a new luxury: the automatic washing machine! All you have to do is put in some dirty clothes and soap, and it practically runs itself!
Washing machines are not nearly as ubiquitous as telephones or TVs yet, but they seem to be on their way. I’d say in another ten years, nearly everyone will have one. For now, the washing machine is definitely still a luxury in Bolivia.
Now be honest, how many people do you know who consider their washing machine to be a luxury?
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Most families in Bolivia still do not own a car. But, I see far more private cars today than I did twenty years ago. In fact, owning a car is starting to become accessible for a lot of families. But it is absolutely still a luxury.
I try not to mention that most American families consider personal cars to be a necessity. OK, it’s usually one per adult, and sometimes a third car purely for entertainment or one for the teenager. Americans have a lot of cars.
Luxury or Necessity?
Looking at lifestyle inflation in this corner of Latin America certainly puts things into perspective. I’d never really thought of my refrigerator, TV, or car as lifestyle inflation. But, it all depends on your frame of reference.
If you grew up in America, you’ve had these things your whole life. And you’re surrounded by people who definitely agree that these things are necessities. We are far down that path of lifestyle creep, and we don’t even realize it.
But there is always more where that came from! There are always more advancements in technology and lifestyle that you can spend your money on. Nevermind those boring necessities. Check out some new pretty things! You’re guaranteed not to get bored!