You may have already felt it and been unable to put your finger on it. Or you may have felt it and knew exactly what it was. You probably feel powerless to do anything about it, even as it impacts your life, and the lives of those you care about enormously.
It’s inflation. It’s your money being worth less, and purchasing less, than it did five years ago, five months ago, five days ago. Statistics can be bent and twisted to suit any argument, but no one will argue that food prices alone will increase by at least 10% in the next 12 months. Odds are your income will not. Throw an increase in fuel prices and rent, and you’ve got yourself an actual pay cut through no fault of your own.
So what does that mean for you and your family? It means you’ll be working just as hard for dollars purchase less. The causes of this economic phenomenon are constantly debated but patently obvious. It’s not the purpose of this blog to detail or discuss them. It is the purpose of this blog to help you Live Better While Spending Less.
If you’re going to deal with inflation effectively, you need to start thinking differently and living differently. Everyone is going to be affected by this. Don’t think your wealthy friends won’t. They’re already aware of it, and if they aren’t already living an Old Money life, they will be soon or they’ll find themselves much less wealthy in the not too distant future.
The upside of this changing economic environment–and I always look for the upside in every situation–is that the awareness of this change presents a dynamic opportunity to change while you can rather than changing when you must. I’ve written about this before, but it warrants repeating.
You’ll need to spend less at the grocery store and still maintain a healthy diet; you have the opportunity to adopt a more vegetarian diet. (Look at it as a culinary adventure rather than a burden. Also expect to feel better and live longer.) You’ll need to look at fuel costs. Maybe you consider public transportation if you don’t already use it.
You’ll need to cut expenses in other areas as well. If you’re storing junk you don’t use or need in a self-storage facility and paying a monthly fee for that, well, there’s a good place to start. Cable television at a hundred bucks a month is another good place to start. Buying cheap clothing that doesn’t last or looks dated after a year is not a plan going forward.
I address these issues and much more in The Old Money Book and detail how to implement them in your life. The philosophy isn’t about being stingy; it’s about being smart. And with the economy we’re all living in now, it’s smart to be smart.
Good news: despite inflation, the $2.99 price isn’t going up. (Wink, nod.)