At this point, there is no getting away from the word inflation. Everyone is talking about it, many complaining about it, but do you know how to take action to survive it? Depending on your age range, you may or may not have experienced life in inflationary times before, however each period holds its own unique struggles.
One of the most important things to remember is that it is incredibly important to be diligent now in the ways you manage your finances so that once we are over the hump of this moment in time you end up in the best possible financial position. The best thing you can do is rework your budget. Think about where all of your money is going, how much you have coming in, and the areas that can stand to be reworked to support your goals while still reflecting the things that are out of your control.
Pay Attention to Your Debts
Interest rates can change rapidly when inflation is happening and while some of your debts may have rates that are locked in, others will not. Either way it is important to continue to focus on not letting those debts fall to the wayside simply because the cost of living has risen. Unfortunately, we cannot neglect our financial obligations in favor of other areas of our budget that could stand to be cut down.
If you have several debts that all have their own interest rates, consider a personal loan and consolidation. Look out for lenders with low APR’S that you can take advantage of. Using a personal loan to pay off high interest debts can save you money in some cases since you will not be paying as much in interest over time. Getting matched with a personalized loan offer is a smart way to respect your wallet in an area of your budget you cannot afford to slack on.
Break Your Routine
Many of us have routines when it comes to everyday habits such as purchasing household items, going grocery shopping, and spending money socially. When inflation is wreaking havoc on consumerism however, nobody can afford to rest on their laurels. You need to start managing your finances in a way that aligns with the current cost of living.
Food costs have been skyrocketing at the grocery store with seemingly no end in sight. While there are always going to need to be things on your list that you cannot skip, that does not mean that you cannot price shop. Think about trying new grocery stores, finding coupons, learning about which stores have sales on which days, or even shopping at a wholesale club for items you can’t go without.
Pay Attention to Prices
In tandem with breaking your routine, you also need to start paying attention to prices on things that you normally mindlessly buy. This also brings up the argument of needs versus wants. Since you cannot control the costs of things like gasoline, looking at the cost of going to the movies needs to become your new normal. This does not mean that you need to totally halt your social life and cut out the elements of your budget dedicated to non-necessities. It simply means that you owe it to your future self to make purchases with your eyes open.
This can be an exciting opportunity to try new things or challenge yourself to find alternatives to activities or purchases goods you love that come at a lower cost. If you are someone who loves a fancy coffee and finds great joy in a well brewed beverage, think about the cost of doing this at home versus getting takeout coffee each day. Chances are the even if you bought a $500 machine and all the fancy accessories to go with it, that is still going to cost you less annually than takeout would. Not to mention you may find great pleasure in being able to create different drinks yourself and curate recipes as you desire in the comfort of your own home.
Build Up Your Emergency Fund
You might think that you are already saving as much money as you possibly can, and even if that is true, take a look at your established emergency fund and think about how you can manipulate your budget to increase it, even if only by a small percentage. Having and building an emergency fund when in the midst of inflationary times is the best security blanket that you can provide yourself. Having this money set aside means that should something happen that requires significant and immediate financial attention, you will not have to completely cripple your everyday budget to get yourself out of said emergency.