HOW TO BUDGET TO BEAT INFLATION
If you feel like you’re in the middle of a battle between your household budget and the price of, well, just about everything, you’re not alone. According to Forbes, inflation is at a 41-year high, meaning many of us haven’t dealt with how to budget as an adult when experiencing uncertain economic times such as these.
If you’re feeling like you are losing that battle, though, take heart! There is much you can do to budget for inflation to beat rising costs until the economic situation improves.
Inflation
Follow these helpful tips to reassess your financial situation and adjust your budget accordingly to address inflation while feeling the minimum amount of pinch in your wallet.
Reassess Your Plan
The first step would be to look at your current spending plan and find areas where you are actually spending more now than when you made it. This could be anything from how much you budget for groceries to how much is set aside for gasoline. If you don’t already have a plan, there is no better time than now to make one. A spending plan ensures that every dollar you have is accounted for to make sure your necessities are paid for and you still have money for the goals you have created.
Measure Your Own Inflation Rate
The rising costs of some goods and services may not even affect you and your household. To know for sure how much you’re being affected, accurately record every cent you spend for a period of time. This information will help you take a good look at where your money is going and ways you can tighten up your spending or find substitutes for the things you need most but are expensive.
Find Ways to Reduce Spending
There are plenty of ways you can either cut or reduce some of your monthly spending to add a little more cushion for the rising price of necessities. Some common bills that are easy to lower include:
Subscriptions like Netflix, Spotify or any other monthly subscription services you thought were cheap at the time, but add up quickly.
Cell phone service with all the bells and whistles. Is your unlimited data plan and hotspot really necessary right now?
Internet companies are always vying for your attention and business. Is there a local company offering a great deal for a limited time that can help cut your bill?
Car and home insurance are also commonly offered at lower rates by different companies.
And remember, you don’t have to say goodbye to some of these services forever. When inflation begins to decrease, they are easy enough to add back into your changing spending plan.
Don’t Cut Out Investing
This situation isn’t going to last forever, and at the end of it, you don’t want to see that you’ve neglected to also be forward-thinking in your budget. Invest in yourself and your money goals by continuing to save smarter. Whether you’re saving for retirement, your child’s education, or just to get through the Christmas season, putting away what you can spare in your budget ensures that you are setting yourself up for financial success even amid uncertain economic conditions.
Reduce Fees on Debts
Not many people take advantage of the fact that you can often negotiate fees attached to your debt or at least transfer the debt to a smarter provider. You are still paying off your debt, but more money is then going to your principal. If you have a credit card, look for a card that offers 0% APR balance transfers or look for low-interest personal loans to help get out of paying high-interest rates.
Finding ways to adjust your budget during these trying times doesn’t have to be a painful process. With just a few adjustments here and there, you can help absorb the rising costs of necessities that are pinching your wallet.