Out of all the economic problems that could occur, inflation can be one of the most destructive. When prices go up, every dollar earned is worth less, making it more challenging than normal to make ends meet.
During inflation, saving for the future can become less of a priority. Even once prices stabilize, families often find themselves behind on their saving goals. To preserve your income and spending power, a strategy can help you get through this economic struggle. Here are some helpful tips you can start using today.
Put an end to late fees
With every dollar being worth less, it’s never been more important to make sure you’re paying all your bills on time by avoiding late payment fees. Costs associated with late fees can add up in a hurry. If you have trouble remembering to pay your bills on time, consider using online bill pay. You can schedule automatic and recurring payments for any type of monthly bill or loan payment. You set it up once and you’re done!
Track your spending
One of the best ways to gain control of your spending power is to know where your money is going each money. Make a list of all your monthly expenses and find places to make spending cuts. Create a budget you can reasonably stick to as a guide to avoid overspending. If you need help tracking your expenses or creating a budget, you can use our free online personal financial management tool, My Financial Partner.
Don’t waste food
The only thing worse than spending more at the grocery store is watching those dollars disappear into the trash. According to the Consumer Price Index, due to inflation, grocery prices were 7.9% higher year-over-year as of February 2022. And according to the U.S. Department of Agriculture, food-at-home prices are expected to increase another 3% or 4% by the end of 2022. With inflation on the rise, it’s never been more important to avoid food waste. Embrace those leftovers, freeze any excess food rather than throwing it out, or share the extra food with those in need.
Stock up on pantry staples
Even with prices on the rise, there are still bargains out there. When you come across a deal, be sure to stock up. Filling the pantry with pasta boxes, jarred sauces, and canned vegetables will be good for future finances, so clear some space and buy while prices are discounted.
Try meatless meals
With the price of meat rising faster than other grocery store items, now could be the time to embrace your inner vegetarian or at least consider eating less meat. For example, if you eat meat every day, maybe pick one day out of the week to go meatless. You don’t have to give up meat entirely, but cutting out meat one or two days a week could make a big difference in your monthly grocery bills.
Delay major purchases
If you’re considering making a major purchase, ask yourself if it’s something you can live without for now. If so, putting it off until the worst of the inflation spike is over could result in considerable savings.
Seek out inflation friendly investments
If you have a little extra cash to save and invest, looking for products that benefit from inflation is smart. Government savings bonds that track the rate of inflation and stocks of companies with rising earnings are smart money investments that could be suitable for the short and long term. Consult a financial advisor for your best options.
Optimize your fuel economy
Inflation at the gas pump is a major economic hardship everyone is facing. Looking for ways to maximize your fuel economy can help. Being conscious about how you travel, as well as, how many miles you travel on an average week is a start. Are there less expensive transportation options such as carpooling to work or school each day to cut down on fuel expenses?
Inflation is nothing new, and prices have risen in the past. When prices are rising, it’s easy to get overwhelmed, but it’s important to realize you do have some control over your spending power. You may not be able to solve this economic dilemma, but you do have the ability to make strategic changes to how you spend money, drive, cook, and live your daily life.
If you need more financial support when it comes to preserving your spending, take advantage of our Partners in Financial Health program. A GreenPath counselor will work with you to review your financial situation and develop a personalized plan to meet your needs.