Seeing prises rise is stressful AF, but these money hacks will help you keep your budget in check.
Inflation is the talk of the (read: every single) town at the moment.
Quick recap: inflation is the rise in the price of goods and services that households buy (i.e. groceries, clothes, furniture). The most common measurement of inflation is the Consumer Price Index (CPI).
CPI climbed to 5.1% in the March quarter, which triggered an interest rate rise from the Reserve Bank and your local Coles and Woolies to push prices up.
If inflation has you more worried than your mum when your phone dies, don’t panic. Here are 3 hacks to get you through the sh*tstorm.
Fact: prices are going up. Fiction: you can control that.
We have no control over how businesses respond to inflation. However, we do have control over how we do. That means we may need to re-think our spending habits.
Prices might be going up, but Woolies, Coles and Aldi still have their weekly specials. Clothing stores will still have sales and even Uber Eats will throw you a voucher every now and again. If you start to shop smart (drive to Aldi if the bread’s cheaper, or Coles if the coffee’s on special!) then you can cut hundreds out of your household spending each month.
If you have multiple subscriptions, it might be time to give them a re-think. Do you really need Netflix, Stan, Disney+, Kayo Sports, Hulu AND Spotify!? C’mon.
Raising interest rates is one way the RBA and other central banks work to keep inflation down. So it follows then, that with inflation going up, the RBA might be looking to increase interest rates again over the coming months.
That means it might not be a good idea to take on any new debts at this time. You could be paying higher interest on these debts, which could leave a bigger hole in your hip pocket - aka not what ya want with the cost of living rising.
Instead, you might want to work towards paying down your existing debts that have variable interest rates.
It’s more important than ever to have a juicy emergency fund to back you up if times get tough. So, if you’ve paid off your existing debts or are on track to do so, you may want to use this time to build your safety net.
The banks are raising interest rates on savings accounts right now, too, so you may want to do your research and compare financial institutions to find the best rate.
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