My family isn't new poor. We've been getting by as best we could for generations. Working class, blue collar, lower middle class, or however you label us, we've never been rich. I grew up helping my mother clip coupons from the newspaper ads every week, and learned how she organized finances to stretch what my dad earned as far as possible.
If you're trying to ease the impact of inflation on your finances, let me share my experience and help you adapt. Not every solution works for everyone, and you may already be doing a lot of this, but my goal is to help you take a fresh look at what's going on so you can examine everything anew.
Budget like you mean it
Know how your money is flowing, and take control.
- What is your weekly or monthly income for your household?
- What are your fixed essential expenses, i.e. rent/mortgage, utilities, and other routine bills?
- How much do you spend on food, entertainment, gasoline, and other consumables?
This needs to be an honest assessment. You can't get to where you want to be if you don't know where you are now. Keep receipts, print off your monthly statements, and itemize everything for the past couple months.
Wrangle those bills
Giving up services you enjoy sucks, but having some financial flexibility in return doesn't. Nowadays, the internet is more an essential than a luxury, but what else can be cancelled? Streaming video or music services are just conveniences. Cable or satellite TV is nonessential. All subscriptions need to be examined carefully and culled ruthlessly.
Nowadays, many have mobile phone plans with payment plans on expensive handsets. Pay those off and get yourself out of the trade-up cycle. Mid-range and up Androids from reputable companies and most iPhones can provide much more than two years of service. See whether you are really using all the features your plan provides. You might save a lot by changing your plan or switching to a prepaid monthly service entirely.
Credit card debt is a curse. Pay off the smallest one, Snowball the savings from that into paying off the next biggest debt. Escape the cycle once and for all. Do not look back.
A new car is an absolutely terrible investment. With incredibly rare exceptions, value falls precipitously. If you have a car payment, can you pay it off faster? Under current market conditions, can you sell a newer car, and trade down to something older and cheaper? A 5-year-old used car will still be under warranty and costs a lot less. Even a 10-year-old car with 100,000 miles on the odometer probably has a lot of life left. Saving a little for repairs is a lot cheaper than a loan or lease payment in any case.
D.I.Y or die
Cook your own meals instead of using DoorDash and Uber Eats, ordering pizza delivery, and going to restaurants. As a bonus, you can learn new skills and take more control over your nutrition. The bigger your family, the more likely someone will have a knack for it.
Learn basic home and auto repair skills so you know how to handle minor problems immediately yourself. Pros have a place, but you can probably do more than you think, especially if you already have basic tools.
When it comes to tools, sometimes you can go cheap, but sometimes the old adage, "buy once, cry once" applies. It takes some experience to know whether you can get by with a cheap Harbor Freight tool and risk having to replace it, or whether you need to bite the bullet and spend the big money for a quality tool from a reputable brand. Taking control of money means taking both the short term and the long term into account. This will sometimes require a lot of research, but the more you will use it, and the more "mission critical" it is, the more you may have to spend. Just like cars, sometimes used is the way to go with tools. Don't be afraid to scour garage sales, thrift stores, and pawn shops. You aren't buying tools for their looks, so it doesn't matter if you're the first to open the box.
Control your spending
Once you know how much money you have to work with, and have your fixed expenses sorted, you know how much is left over. It's probably less than you thought. Time to make it stretch as far as possible!
Organize your pantry with stored foods you actually use, and keep an inventory. Watch for sales and stock up when the price is right. Rotate old supplies to the front of your shelves and put the new stuff in back so you don't have any nasty surprises.
Buy in bulk. This is only thrift if you use it, but canned goods, dry pasta, flour, whole grains, beans, and seasonings have a long shelf life if stored properly. If you go through many small jars of, say, peanut butter, compare the cost per ounce for a larger jar. Buy big unless it's likely to go bad before it's empty. Paper towels, toilet paper, facial tissue, and other such goods can be stored for years if kept dry, so if you have the space, buy in bulk and don't look back! You're also better prepared for the next bizarre panic-buying frenzy.
Us rural folks are already accustomed to shopping as a rare expedition, and plan ahead so we can get what we need in as few trips as possible. Even if you live somewhere urban, don't be fooled by convenience. Your budget doesn't have room for spending on a whim.
Have fun . . . responsibly
All this talk of cutting back and working harder sounds like not a lot of fun. It isn't, but escaping debt and taking control of your finances can also ease a lot of uncertainty. I'm an introvert, and more than content to retreat into solitude when I get home, but even so, I get the urge to be social. If you're more of a social butterfly, frugality doesn't have to mean becoming anti-social. Life doesn't have to be all work and no play. Make some tradeoffs and set a schedule. For example:
- No desserts, except on Sunday, when you have something special.
- No streaming services, but visit your local library for DVDs, and plan a Monday family movie night.
- Cancel Xbox Live, but schedule a Tuesday with Friends night for some old-fashioned couch co-op or even really old-fashioned tabletop games to create real social connections.
- Instead of going out to dinner, grill burgers at home and invite the neighbors over every Wednesday. Rebuild those community connections we all feel like we've lost. Or maybe there's a church youth group for the kids and a fellowship meeting for adults?
- Join a summer sports league through your parks and rec department, church, the YMCA, or other opportunities in your neighborhood. Play games on Thursday, and practice all week with your roommate. As a bonus, maybe you don't need a gym membership after all.
- Friday means the work week is over for most folks. Kick back and relax! Maybe this is a good night for a date?
- The weekend is here! Time to focus on home projects, or maybe the weekly shopping expedition now that the budget is squared away. But then again, maybe it's time for a drive to the beach, a state park, or some other nature getaway, too.
It's not about depriving yourself, it's about rediscovering what a lot of us used to consider normal life. It's about taking a hard look at the cost/benefit analysis of everything we've just accepted without question as it was offered to us over the years. It's about creating the opportunities we need for productive change as we break the patterns of bad habits. Growth hurts. Progress can be a struggle. It doesn't have to be miserable along the way, though, and the long-term reward is a better life in spite of the chaos we must overcome.
The grand finale
Remember, most of us have two choices: take control of your money, or let your money take control of you. Save now to get ahead, or feel the pinch when you're left behind. I want to see every reader get out of debt, learn skills, save money, and find more independence so they can thrive. Even if we are facing another global financial crisis, our you suffer personal setbacks, you'll be in a better position to bounce back. We can't change the world, but we can influence our tomorrows by what we do today.
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