Raise your hand if you like inflation. No one?? You can almost feel your purse or wallet getting thinner by the day. According to Gallup, 55% of Americans say inflation has caused financial hardships in their household and 13% say this hardship is severe. That’s the reality of inflation. What can you do about it? As daunting as it may seem, you don’t have to sit back and accept defeat. You can fight back and it all comes down to your budget and how you manage it. Let’s talk about what that actually means and how you can budget your way through rising costs.
The first step is having a budget. What is a budget and how do I create one? A budget is a plan for your money, a roadmap for every dollar that comes in and out of your Smart Financial savings and checking account. If you don’t have a budget, set one up NOW. There are many budgeting software tools available online, so research the one that best fits your needs. This is the first step to lowering your financial stress and being prepared and able to fight back against inflation. The goal for your budget is to give every dollar a job that you assign it! Dollars you don’t budget for can get spent accidentally or frivolously. And with inflation making things tighter than normal, you can’t afford frivolous spending.
In creating your budget, you might soon realize you’ve been overspending. Are you relying on credit cards to finance your expenses each month? Do you find yourself falling further and further into debt?
Take a look at these five tips to help you get a better handle on your money and get yourself on solid ground as you battle the inflation monster!
1. Review Your Spending
Everything seems to be more expensive these days, but you might not know exactly where it’s hitting you the hardest. The first step in fighting inflation is to get out that budget and look over your spending. Are there things that you can do without or things may be considered a luxury? How often are you eating out or clicking that buy button on Amazon? Budgets can help you take a look at your essential expenses and non-essential spending.
2. Find Ways to Save
Once you know where the inflation monster is hitting you the hardest, you can start finding ways to save.
Grocery spending is one way to trim expenses. Picking generic or store brand products, plan your meals out for the week, and look for items you can buy in bulk. Save on transportation costs by combining your errands and joining gas rewards programs. Clean out your car of any items that are adding weight to you vehicle, and using the cruise control when you can for freeway driving. Save on your electric bill by replacing your air filters regularly, only running appliances when they’re full, and turning off your lights when you leave a room! Look for coupons for grocery items, restaurants and other businesses. Those savings can add up and it’s worth the time to explore for coupons you can use. These are just a few ways you can save money and combat inflation.
3. Earn Extra Money
A term you hear a lot these days is side hustle. Hustle used to have a more negative connotation, but now many people are looking for ways to earn extra money! Some jobs you can do from your couch or maybe a few hours on the weekend. They say “one person's junk is another’s treasure". Do you have anything lying around collecting dust that you can sell? eBay and Facebook Marketplace are two ways to find buyers for some of those items and can give your savings account a real boost. The extra income with this extra work could balance out the increase in costs.
Earning extra money doesn’t mean you can start living more extravagantly. You should apply that money to the budget you created and continue to make sure every dollar has a job to do!
4. Cut Expenses
Another way to battle inflation is to cut your spending. When reviewing your budget and asking yourself what you could do without for a while, did you find things you could get rid of easily? Trimming your budget is not fun, but it can help you become a lean, mean financial machine!
Cut the cable and look into the various streaming options out there. Many streaming services have great incentives for first time subscribers. With so many streaming choices, find the one or two that best fit your tastes. Most services have more content than you could possibly watch. Expand your horizons and try out new shows and you may find that one or two streaming services are all you need. You can also hook up an antenna and receive all of your network channels and a ton of other channels that show movies and older sitcoms – all FREE!
Don’t buy clothes (unless it’s an actual need). Drop the premium music subscription and endure the ads. Stop eating out. Make coffee at home.
While it may feel like you are being asked to sacrifice so much, remember, this isn’t forever.
Cutting expenses now will help you keep debt at bay and keep you on solid financial footing while we experience high inflation. Cut your expenses as you can to help you maintain a balanced budget.
5. Shop Around
Costs are on the rise everywhere, but there are deals to be had if you take the time to shop around. Research store websites to look for deals. Many online communities exist where members give out great advice on deals they have found or stores offering incentives. Research before you buy. Maybe you don’t need the top of the line product and can do just fine with one that is cheaper. More expensive doesn’t always mean better!
We are often creatures of habit or have loyalty to certain stores. Because of this, we don’t price compare as much as we should. Go online and look at prices for items you need. You may find another store offers better pricing. For groceries, you don’t have to stay loyal to where you’ve always shopped just because you’ve always shopped there.
Many grocery stores sell gasoline and also offer discounts tied to your grocery spending. This can be a great way to save on your gas expenses. Use these discounts to fill up when your tank is closer to empty so you are buying more gallons at your discounted price.
It may take more time to research and price compare, but shopping around so you can defeat inflation is worth it.
Cutting expenses hurts, but it will be okay. You will be okay! That’s why you’re taking these steps. This is a battle! You are making wiser decisions with your money and adjusting your budget and that is ALWAYS a good thing.
You've got this!