Dave Ramsey says: Respond to inflation by adjusting your budget
All the talk on the news about inflation is a little scary.
Is there any way to protect yourself against it on a day-to-day basis?
When people start talking about inflation, it seems like there are always some who want to start collecting gold, fill every container they own with gasoline and stick their cash under their mattresses. But listen, you can prepare for inflation and address the results without being panicked.
You are still in control of your money, inflation or not. You’ll be able to make sure your money is going toward the right things, while being able to find places where you can cut spending, if you’re living on a written, monthly budget.
If you’re noticing the prices of things like food and gas rising in your area, you’ll need to adjust your budget to account for this. That way, you’ll know exactly what you’re working with, and it will help you avoid any nasty surprises.
If you’re really feeling the pinch and want to save even more, look for specific ways to lower your grocery bill or save money on gas. Maybe it’s time you switched to generic brands, or started a carpool into work. If you find great deals on canned food and things you can stock your pantry with—I’m talking about stuff you’ll actually use—go ahead and buy a little extra. Just make sure you’ve budgeted for it before heading to the grocery store. You’ll want to already know exactly what you’re going to spend, so you don’t get swept up into impulse buying.
Like it or not, inflation is a thing. If you plan on retiring one day, it’s pretty much guaranteed that the cost of a loaf of bread, a tank of gas and even a cup of coffee will have gone up by then.
The best way to protect yourself against inflation that’s bound to happen is to invest your money—and the sooner the better. But remember, if you still have debt other than your mortgage, and don’t have an emergency fund of three to six months of expenses, you need to take care of those things first!