You must have heard the term “inflation” by now. The rising costs of food, fuel, and almost everything bear the wrath of inflation. It will affect you and your family; it’s inevitable.
The financial condition of many households is evolving rapidly. Inflation is the cost of goods and services snowballing, and most people worry about shielding their families from inflation.
Everyone wants to protect their families from the harsh effects of inflation. Maintaining the current lifestyle vs. safeguarding the future is a dilemma for many. The best way to fight inflation is to make little adjustments to the current lifestyle and secure your future.
It might be challenging to consider financial adjustments while still trying to raise a family. But with little lifestyle modifications, you make it work.
What is Inflation?
Inflation is the gradual rise in the cost of goods and services. Your purchasing power decreases due to inflation, meaning a dollar spent now will be worth less.
The Bureau of Labor Statistics (BLS) indicates that inflation increased by 1.3% in June 2022.
The government maintains track of inflation by measuring and disclosing variations in the Consumer Price Index (CPI) from month to month and year. The CPI change over the previous year is what most people refer to when discussing the inflation rate.
How Does Inflation Affect Families?
Inflation has hit every family. Some homes have been able to endure price rises, but economically challenged families increasingly find it challenging to afford the essentials. Food and energy have seen significant changes in recent years, and some households are hit harder by inflation, including low-income families.
Everything is getting expensive, and the basic needs go beyond affordability for low and middle-income families. From meat to vegetables, everything in the pantry has reached peak prices.
Not only is the cost of food and gas on the rise, cars, houses, building supplies, and personal care items are all increasing.
How to Use Your Money Right and Protect Your Family from Inflation
Everyone’s budget seems to be increasing because of the surge in prices. You can fight back and survive inflation or hyperinflation if you are mindful of your money.
Earning and then careful spending is our new mantra during challenging situations. Inflation can take away a considerable part of your earnings, but a few strategies and the right money mindset can help you stay sane during these insane times.
Here are some tips for being smart with money and protecting your family from inflation:
Have the Right Money Mindset
Budgeting is not just about creating a budget and never looking at it again. It needs more care and vigilance to live a good lifestyle and never worry about the future. You’ll never run out of money when you create a safety net for your finances.
If you fall into the first type of people, change your perspective and adopt the right money mindset.
Plan Your Meals
Planning your meals will not only save you time and keep you organized, but it will save you money too. You only buy the necessary ingredients when you know what you will cook in the coming days. Meal planning helps in keeping unwanted things away from your grocery shopping list.
You can create a healthy meal plan on a budget. You can decide how frequently you need to plan your meals. Some people love refreshing their meal plans every week and stick to bi-monthly or monthly. Pick the most suitable meal planning method and shop the ingredients accordingly.
Stock Your Pantry for Emergency
Everyone has faced the worst days during the lockdown of 2020. The pandemic forced everyone to stay home for safety reasons. And that was the time I thanked myself as I had stockpiled my pantry already. I wouldn’t have survived the pandemic if the long-lasting foods were not there for the rescue.
I learned a lesson for life. Don’t be a hoarder but stock your pantry for emergencies. I prefer stocking up my pantry for at least three months, saving me money on frequent supermarket trips.
Live Below Your Means
Try to live within your income. Living below your means is the best way to embrace a frugal lifestyle. Borrowing money from tomorrow to celebrate today’s life is foolish. Piling up on debt isn’t good for your financial health.
It is possible to enjoy the things you love even if you live below your means, as long as you make financial decisions that will offer you more excellent stability and happiness later in life. When you have financial management, you no longer have to worry about unforeseen expenses. You gain control over your expenditures by adhering to a budget.
Differentiate Between Needs and Wants
It’s important to categorize your spending when creating a monthly budget by whether it’s a “need” or a “want.” Understanding the difference between needs and wants is essential. When you have a clear idea about what you need, you can neglect your wants.
Your wants are entertainment, travel, dining out, recreational activities, leisure club memberships, subscriptions, gym membership, and new clothes. Your utility bills, rent, food, medicines, therapy, healthcare, and transport fall under the needs category. You can postpone or skip them altogether to save money and survive the inflation.
Cut Down on Unnecessary Expenses
When you have understood the difference between your needs and wants, it’s easier to cut down on unnecessary expenses. You can cancel the cable connection and opt for free entertainment, which helps you save a good amount of money.
Exercise at home by watching free videos on YouTube, and unsubscribe from all the unused and unnecessary subscriptions that keep taking away your money even before you realize it. If you need a change of wardrobe, go to thrift stores and buy the preloved clothes at lower prices than the new ones.
Stop Eating Out
The most accessible approach to reducing your food expense is to prepare your meals, which is the secret to healthy eating. Eating out frequently can be unhealthy for you and your wealth. You can try making food ahead and stop eating out. Freezer meal planning is another great idea to stick to a “no eating out challenge” and save money.
Cooking at home helps avoid dining out cravings, which lets you save money.
Negotiate Your Salary
If you are currently employed, you can request a pay raise. Your employer may resect your request and help you fight inflation with the help of a correction in your monthly take-home salary.
Look for a Side Hustle
If one income is insufficient to survive the inflation, look for a part-time job or a side hustle to help you earn an extra monthly payment. You can sell your skills to a potential client and work during your free hours to meet ends needs.
Side hustles help you make more money by utilizing your free time and skills. You can encash your time and talent to earn extra money and save for emergencies.
Where Do You Put Cash During Inflation
Inflation-beating strategies often include long-term planning, such as retirement savings. Investing in assets with the potential for inflation growth is the best way to protect against inflation. It will help if you put your cash wisely, which will help you grow your money during inflation.
Here are some ways to make use of your money during inflation:
- Put your money in short-term bonds
- Invest in stocks
- Invest in real estate
- Consider Treasury Inflation-Protected Securities (TIPS)
- Invest in commodities
- Invest in entities with low capital needs
- Buy gold and other precious metals
What should I stockpile before hyperinflation?
If the food shortages concern your future, stockpiling can help fight the chaotic situation. At least a month’s worth of food should be in your pantry. More, the merrier! But that depends upon your budget and the cash you have right now.
Here is a list of things you can stockpile now and live a stress-free life without worrying about shortages and rising prices.
- Dry foods with longer shelf life like pasta, rice, spices, beans, and dry fruits.
- Cooking oil
- Baking supplies like sugar, flour, baking soda, yeast, and salt.
- Canned foods
- Frozen fruits and veggies
- Milk powder
- Paper products
- Cleaning supplies
- Soaps and body wash
- Shampoo and conditioner
- Peanut butter
- Prescription medications
- Pet food and medications
Final Thoughts on “How to Protect Your Family from Inflation”
Each dollar loses value over time as inflation causes monetary pressures. Inflation takes away your purchasing power from you. You can plan for inflation by understanding how it works, using it to your advantage, and protecting yourself against its more damaging effects.