How People are Budgeting While Battling Inflation

Inflation has been the economy’s largest issue over the past year as the cost of living has shot sky-high. So high, in fact, that it is nearing the highest level in more than 40 years. Food prices soared over 10.9% in the last year.

Extremely high costs have required people to budget more and really consider how they are going to spend their money.

Here are a few ways people are protecting themselves from inflation’s worst impacts:

Prioritize Saving

It is very important to plan ahead and figure out how much you can comfortably put away from each paycheck. This amount depends on a couple of different factors. Some people follow the 50/30/20 rule: 50 percent of your income goes towards needs, 30 percent goes towards wants, and 20 percent is saved. Although this method is not suitable for everyone, especially those living paycheck to paycheck, saving what you can and not tapping into it for daily spending is a very important step in protecting yourself from the impacts of inflation.

Become More Intentional About Where Your Money is Going

After setting aside money for savings, what is the most beneficial way to spend the rest of your money? According to Bankrate, “being more aware of your spending can help to eliminate impulse purchases.” Consider making payments towards consumer debt a priority. “If you get out of debt sooner, you can save more in the long run, by limiting the amount of interest accumulated.”

Shop Smarter for Groceries 

Eating is not something you can eliminate from your everyday life. Food is entirely necessary yet extremely costly these days. Check out these ways from Forbes to manage your grocery budget:

• • Swap out brand-name items for generic products as much as possible.
  • Buy in bulk if it allows you to purchase items at a lower unit price.
  • Incorporate more meatless meals into your family’s diet.
  • Use grocery store weekly sales flyers to plan budget-friendly meals.
  • Shop local farmers’ markets if that’s an option where you live.
  • Incorporate more low-cost staple items into your meals, such as pasta or rice.