Rising inflation continues to be at the forefront of everyone’s minds, and the most immediate effect of rising inflation is the rising prices of everyday goods and services. That’s why we’re seeing everything from our weekly grocery shop to fuelling up the car get more and more expensive. While the effects of inflation are being felt around the world, there are some ways we can minimize the impact. Here are ten top tips to help you battle the cost of inflation.
1. Get clear on where your money is going
Cutting costs starts with getting clear on what your costs are. Set aside some time to understand how much you spend on different areas of your life, like groceries, transport, and entertainment. From here, you can look for efficiencies and discounts to help you cut back. Laying it all out in one place makes the task much less daunting!
2. Focus on efficiencies in your food spend
Grocery shops are one of the first places people notice rising prices. The price of food increases because rising costs that are impacting producers and suppliers get passed onto the end consumer — and it can be frustrating and concerning, especially if you’re already very diligent with your grocery spend.
One of the best ways to make your grocery budget stretch further is to focus on efficiencies with your ingredients. Purchasing simple ingredients that can be used in all different ways helps minimize waste and create more meals for less. Work your meal planning backwards, by shopping your pantry first, and then making meal decisions based on things you’ve already got. If you are buying extra ingredients, try to maximize those in other things you decide to make.
3. Slash your transport spend if you can
With fuel prices going up, even the shortest journeys can guzzle your tank and your wallet faster than ever. Look for ways to slash your transport spending to save big over the long term. Things like carpooling with a friend or coworker, sticking in a podcast and getting public transport (even if it takes a little longer), or requesting to work from home an extra day can add up.
Calculate how much your regular journeys cost in petrol and see where you can cut back. Saving one $10 journey a week would save you over $500 per year!
4. Have fun for less (or for free!)
Unfortunately, rising inflation means cutting back on some luxuries for most of us — but that doesn’t mean cutting back on seeing friends and having a good time. Get together and brainstorm some fun ways you can relax or socialize for free. Swap meals out with potluck dinners and BYO wine, go on a walk and take a traveler coffee (or cocktail!), or host a games night at home.
5. Look for bulk discounts
If you’re guilty of opting for the cheapest label price rather than the cheapest cost per 100g, it’s time to switch it up. Buying in bulk doesn’t have to mean buying a year’s worth of toilet paper. It can be as simple as buying the larger size of things you regularly use to maximize your money. Things like olive oil can be substantially cheaper per milliliter when you buy the larger bottles instead of the smaller ones.
6. Check for annual discounts
When paying for regular expenses like insurance or subscriptions, check if there’s a discount for paying annually. If you’re able to pay the full year upfront, often you can score big discounts and reduce the average monthly cost substantially.
7. Monitor your expenses
The key to getting the compounding benefit of small money-saving actions is to ensure you’re repeating the behaviors and keeping on top of them. Monitor your expenditure over time and keep abreast of changes to things that could be creeping up in price without you realizing it.
PocketSmith can help you do this by displaying all your transactions in one place, and helping you identify trends that can help you make better money decisions.
8. Check you’re getting the best deal
Staring at bills and wondering how to cut back can be really stressful, but don’t forget you can ask for a better deal on your household expenses. From energy providers to phone plans, make a list of all your outgoings and give them a call or hop on live chat. Often you can switch phone plans instantly, or score a lower rate on your car insurance just by asking. Shopping around other providers may also uncover a cheaper price, or information you can use to leverage a better deal with your existing company.
9. Check your interest rates
For the first time in years, interest rates are rising. While this adds extra pressure to borrowing by increasing mortgage and debt repayments, it also means you can earn money on your savings. It pays to check in with all your interest rates, both ones you pay and the ones you earn, to ensure you’re paying the least, and earning the most!
Example: You’ve got a $500,000 mortgage at 3.5%, and $10,000 in a savings account of 0.5%.
If you can reduce the mortgage rate to 3.3% and increase the savings account rate to 1%, you’ll be $1100 better off.
When cutting back on costs gets difficult, your other option is to increase your income. You can start by selling off some preloved items online, or freelancing your services on global sites like Fiverr, Airtasker or Upwork.
Earning extra cash can also be a great way to help you build up an emergency fund for unexpected expenses, too.
Emma Edwards is a finance copywriter and blogger, on a mission to humanize the financial services industry by creating meaningful content that’s accessible and empowering. You’ll find her penning money tips at her blog, The Broke Generation, sharing financial insights on Instagram, or injecting life into content for her business clients.
