5 household tips to counter inflation

Over the past few days, my Facebook feed is filled with the current inflation rate. As a wife and a Filipino, there is no denying that the country’s inflation has been rising. And this definitely impacts our finances.
But before anything else, let us discuss inflation.

According to InvestorWords.com, Inflation is a general upward price movement of goods and services. Over time, as the cost of goods and services increase, the value of a peso is going to fall because a person won’t be able to purchase as much with that dollar as he previously could.

A good example of how inflation works is the buying capacity of your money. For instance, if you can buy a lot of goods for 100 five years ago, chances are you might already be getting less for the same amount today.

But nothing can stop inflation. Inflation is inevitable though the value varies. As a consumer, you just have to be smart and just flow with the varied inflation rate. Our main goal is beating and outperforming no matter what the number is. Hence here are tips to counter the current inflation rate of the country.

Tip 1: Tighten the Budget. More than ever it is important to revisit your former budget and tighten the money. The new inflation rate can affect our basic commodities hence you might want to change a few of the items there. Adjust the amount that you usually spend on a daily and a monthly basis. You can either lower the cost of some necessities or perhaps control the cost of the other. Just make sure that your income can be able to cover the basics and still have room for savings or investments. For instance, if you decide to lower the cost of food you need to carefully plan the food budget and the food preparation too.

Tip 2: Involve the Family. Beating inflation is not a one-man effort but rather a household one. If you decide lower electricity cost of the household, make sure the other family members are involved. Tell them that they too should be smart when using the air-conditioner or other household appliances. Set a certain time limit for watching the TV. Make sure everyone is involved and are doing their little tasks to contribute in decreasing cost in the household.

Tip 3: Cut Unnecessary Expenses. Always remember needs versus wants. Evaluate current expenses and identify which ones are considered wants and unnecessary and delete or cut it down. For instance, if you have been accustomed to driving individual cars every day try to do a family carpool instead and use one car at a time. If you have been dining out every week, you can lessen it to twice a month or during special occasions instead. You can even delete a few of the unnecessary items in your groceries such as beverages, chips, and so much more.

Tip 4: Find Cheap Alternatives. There are always areas where you can be able to find items that cost for less. For instance, you can do your grocery shopping at your local markets instead of the grocery stores found in malls. You can even grow your own vegetables and livestock especially if you have a great extra space at home. This can drastically help decrease the need to buy vegetables and meat like chicken or pork.

Tip 5: Invest. The effective way to beat inflation is to make sure that your money works for you and returns values more than the inflation. Saving your money in this case won’t cut up anymore since putting your money in a bank account can only yield less than 1%. So it is best to invest now in mutual funds, stocks, and bonds that allows your money to grow more than the intended inflation rate of the country. You can even invest in businesses that gives higher profits or franchise businesses with proven track records in terms of profits and gains.

Indeed there are many ways to beat inflation. You just have to be money smart and be money wise for that matter. These tips can help you be prepared regardless what the inflation rate of the country is.