Proven tips to deal with rising inflation

If lately you’re feeling like your budget is tight, there’s good reason for it. The inflation rate is the highest it's been since the early '80s, and it looks like the rising prices of consumer goods are here to stay. Such huge inflation spikes contribute to market volatility and economic instability, creating turmoil in the traditional stock market. There's also a pretty good chance that your salary hasn't increased at the same rate as inflation, so it's no wonder your budget might be feeling a little tighter!

But don't despair. Here are some proven tips you can keep in mind to stretch your money and be able to afford the things you need.

Be aware of shrinkflation

Shrinkflation is a tactic where companies will slowly shrink the contents of the packages and goods you buy, while charging you the same price. Therefore, pay attention to the unit price of what you are buying.

Buy the car you’re leasing

Inflation data in 2022 has shown that new-vehicle prices rose 13.6% since March 2021, while prices for used cars were up 34.7%. If you have a vehicle lease expiring soon, then you have a way to avoid those higher prices. That’s because your vehicle’s lease-end price was set when your lease began, before the current inflation. So if you buy it, you'll get an almost-new car for an inflation-free price.

Time your expected purchases

People sometimes save up for unexpected expenses, such as house or car repairs or even medical bills. But it's also important to keep cash on hand for expected purchases that go on sale, even if that means buying ahead of time. For example, it's better to buy back-to-school supplies on sale, instead of waiting for the fall when goods have higher prices.

Seek a higher return on happiness

When prices start soaring, take your time to think about what you’re spending money on and why. Then stop spending money on the unnecessary things that don’t bring you joy. You will then no longer be impacted by inflation in this area.

Better insulate your home

Given the current higher costs of fuel, it's a good idea to invest in better insulation for your home. This upgrade will help lower your energy costs.

Update your CV

With the current job market, there’s an opportunity for many employees to find new positions that will pay them more, which is a huge benefit in an inflationary environment.

Watch for falling prices

This might sound a bit counterintuitive, but one way of dealing with inflation is accelerating certain purchases. This is because consumers will need to cut spending on discretionary items, so a lack of demand may cause the prices of various nonessential goods to decrease. This gives you a unique buying opportunity.

Shop frozen foods

Don't be afraid of frozen food! For instance, frozen seafood is less expensive than fresh, and there’s no rush to cook it. Plus, frozen berries and spinach will last longer than fresh, while being just as nutritious.

Discover local farmers

By shopping direct-to-consumer, you'll get better food prices due to the lack of shipping costs and a middle man. Meet your local farmers, and you'll get the freshest food possible for a great price.

Use it or lose it

Make a list of your subscriptions, such as streaming services and gym memberships. Chances are you probably have them on autopay. Go through the list, and if you haven't used it in a month, cancel it.

Cut salon cost

Find out whether your salon offers discounted prices for hair cuts, color, and other services when training new stylists. It will be a lot cheaper.

Shop second hand

Check second-hand shops, yard sales, and online marketplaces for deals on clothing, home decor, and so on. Look for items that are in new or good condition, and set a budget in advance.

Reduce energy use

By making simple changes at home, you can cut down on the costs of your utility bills. For example, a microwave uses as much as 80% less energy than an oven. Also, washing dishes by hand costs about US$40 more each year than running a fully-loaded dishwasher.

Look for cheaper alternatives

As prices rise, your previous purchases may no longer be possible within your existing budget. Try less expensive store-brand foods and cleaning products. You'll notice that there isn’t a huge difference in the quality or taste.

Research past inflation trends

Researching past high inflation trends can help you identify some current and future inflation patterns. These include the performance of real estate and the stability of the energy sector.