9 Tips for Surviving High Inflation
So, I think we can all agree that inflation in 2022 has been insane. It impacts all of our daily lives in a lot of ways. Grocery prices are ridiculous. Gas prices are crazy. And, unfortunately, it’s not like we all get pay raises to keep up with high inflation. If only…
We can’t avoid the impacts of inflation. But there are some things we can do to help cope with it the best we can. So, let’s talk 9 tips to make the most of your money in the midst of high inflation.
1. Create and maintain a budget.
If there was ever a time to start budgeting, it’s now. Why? Because budgeting is all about having a plan for your money. It’s important so that you don’t find yourself overspending, which was easy to do before. But it’s especially easy to do when everything costs so much.
By creating a budget, you’re making a point to anticipate how much life will cost you in the upcoming month. Then, by tracking your actual expenses in your budget, you’re able to stay on top of where your money is going. Inflated prices are shocking enough. Budgeting will, at least, help you to avoid unpleasant surprises when you check your bank account or credit card balance.
2. Lower your grocery expenses.
There are quite a few ways to go about doing this. I have an entire blog post about saving on groceries, if you’re interested. But for now, to name a few...
Shop your kitchen first.
This means, before creating a grocery list, go through what’s in your refrigerator, freezer, and kitchen cabinets. This will ensure that you don’t buy things you already have (but may have forgotten about).
By shopping your kitchen first, you can also take inventory of what you already have to make meals with. From there, focus on only adding things to your grocery list that complement what’s already in your house. So for example, if you have a jar of pasta sauce, and you’ve got ground meat, just add pasta noodles to your grocery list to complete the meal.
Plan your meals.
Meal planning is a great way to save some money on groceries. If you plan what you’ll have for meals throughout the week, it will help you to have a more targeted grocery list. You’ll spend a lot less this way than if you just peruse the grocery aisles picking up whatever seems good.
3. Save on gas.
Here are a few ways to do this:
Fill up your tank on Mondays.
On average, gas prices are lowest on Mondays. The most expensive days to get gas have fluctuated between the weekends and Thursdays.
Sign up for gas station rewards programs.
If you’re not signed up for at least one gas station rewards program, there’s no time like the present! It’s a free and easy way to save money at the pump. I love the Cumberland Farms rewards program. It offers 10¢ off of every gallon. Plus, you get other freebies here and there as a bonus.
Stop & Shop offers another good option. Their rewards program allows you to use grocery shopping points towards a discount on gas at their Stop & Shop gas stations.
Batch your errands.
When you run errands in many different trips, it means you’re driving back and forth multiple times from home to wherever. Instead, save gas by running as many errands as possible in one shot.
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4. Cut back on unnecessary spending.
This can be a hard pill to swallow. You work hard for your money. You should be able to enjoy certain luxuries, right? But there are lots of things that you don’t absolutely need in your life. And since the necessities (like gas and food) cost so much right now, you may want to consider cutting out at least a few fluff expenses. Order food a little less. Don’t do as much clothes shopping. Put some of your streaming subscriptions on pause for a little while.
The good thing is that you don’t have to say goodbye to these things forever. Different seasons call for different things. We just happen to be in a season of high inflation that may require us to make a few more sacrifices than we normally do. But it’s not forever. This too shall pass.
5. Choose free or cheap alternatives for fun.
Entertainment and socializing costs money a lot of the time. But challenge yourself to find free or cheap ways to have fun with your friends and family.
Instead of going out to eat, have a get-together at your house (or someone else’s) where everyone brings a dish. Have movie night at home. Host a game night. As far as date nights go, there are lots of options! Check out my blog post, 21 Free or Cheap Valentine’s Day Ideas. They’re all date ideas that you could easily do anytime!
6. Carefully consider expensive purchases.
Inflation means our dollars are worth less. (Inflation lately makes it feel like our dollars are literally worthless. Sorry, I couldn’t resist the opportunity to make that corny joke. 😏) Since our money doesn’t stretch as far as it once did, you’ll have to spend a lot more of it to afford the things you want.
Not to mention, when inflation rises, typically, so do things like mortgage rates and other loan rates. So purchasing a home or new car can end up being especially expensive.
Those are both major purchases that I assume you put some planning and forethought into. So, I’m not telling you not to make those purchasing moves. I’m just advising that you consider the impact high inflation has, so you can make the most informed decision.😉
7. Pay off debt (at a discounted rate).
If you have debt, there is actually a benefit to high inflation. (Surprise! 🎉) The prices of things are rising like crazy all around us to make up for the fact that our dollars have less value. BUT your existing loan amounts don’t increase. And because your loan amounts stay the same, it means you’re getting away with paying off your debt with cheaper money.
Let’s give this some context:
With inflation at 7.9%, $1 is actually only worth about 92¢.
Let’s say you have $5,000 of debt.
Since your loan amount doesn’t rise (like the prices of just about everything else in life), you get to pay that $5,000 with money that’s actually only worth $4,650.
So if you pay off as much debt as possible during high inflation, it’s like getting to pay off your debt at a discounted rate! 😃
8. Avoid taking on new debt.
Interest rates typically rise right along with inflation. So, taking on any new debt will also likely mean taking on even higher interest rates. No thank you! Credit card interest rates were ridiculous enough as it was before all this inflation.🙄
9. Invest.
If you’ve been investing for retirement, continue to do so. And if you haven’t been investing for retirement but you have money to spare, you should start.
Why invest? It’s the way to go in order to outpace inflation. In the long-run, the rate of return on your investments is likely to be greater than inflation (even when it’s really high). To help put things into perspective, at the time of writing this blog post, inflation is 7.9%. Meanwhile, the stock market’s average annual rate of return is 10%. So, the money you invest today will likely grow so significantly over time that you still end up on top, despite experiencing high inflationary times like these.
With the high costs of inflation, wouldn’t it be nice to have a little more money to work with in your budget?
Get your free download of 9 Ways to Find More Money in Your Budget (Including Real Numbers!).
Conclusion
Inflation is awful. No one enjoys crazy high prices or the fact that our money has lost value. Unfortunately, no one can escape inflation either. But there are practical ways to cope with high inflation and make the most of your money given the circumstances.
Hopefully, the tips above will help you to stay the course financially and experience some money wins, even in the midst of high inflation.
Which of these tips did you find most helpful? Do you have any other tips for coping with high inflation? Share in the comments below!
