There’s no escape from inflation. Nowadays, this tension at the heart of the modern economy is more evident than ever, with millions of people drowning in debt. It begs the question: what can we do to quell the issue? Unfortunately, the answer might be a bitter pill to swallow.
When the real estate market is so volatile that the BRRRR method may not be enough and any further investment is discouraged, all regular citizens can do is stick to the tried and true methods.
Besides tightening the belt, many people decide to ask their boss for a raise or leave their current position to try their luck elsewhere.
Those more courageous continue investing, focusing on long-term benefits. On the other hand, many people try to increase their income by renting or selling their stuff.
If you are looking for ways to combat rising inflation, here are some valuable tips to help you get back on your feet:
Check Your Expenses and Budget
There are many ways to save money, but the most important thing is to have a plan of action. Take your time to carefully analyze the situation and devise a plan that suits your needs.
The first thing you should do is take a good look at your expenses. Write down all the money you spend on a daily basis. If possible, evaluate how much of this money is spent on unnecessary luxuries. You can also think about how you can raise your income.
If you want to borrow money, make sure you get a credit card with lower rates. Another option is to apply for a secured credit card, which requires you to deposit some of your own money in exchange for a low-interest loan.
There is no magic number for how much you should save each month, but knowing where your money is going is a good place to start.
Inflation can be unpredictable, so it’s essential to have a plan in place. Decide how much you need to save and invest to reach your financial goals. This way, you can make adjustments along the way if inflation starts to heat up.
Invest in Yourself
Many people today are looking for ways to secure their financial future by investing in their education.
For example, if you want to become a licensed professional or a certified specialist, you can work towards that goal by enrolling in a college or a university. The result will be a better-paying job and more opportunities on the market.
What’s also great about higher education is that even if you decide to leave school before graduating, you will still benefit from the knowledge that you gained.
Investing in your education and career is one of the best ways to stay ahead of inflation. By becoming more employable, you will be better positioned to negotiate higher wages.
Consider Alternative Investments
When traditional investments no longer provide the returns they once did, it might be time to look at other options. A Series I savings bond (I Bond), for example, can be a more stable investment than stocks in an inflationary environment.
The truth is that the most common investment vehicles today — stocks and bonds — are not performing as well as advertised. In fact, many of them are currently giving negative returns, which is not a good thing if you are looking to add some money to your account here and now.
An attractive option is to invest in real estate, but most people are wary of doing so because it’s risky. If you’re willing to take the plunge, there are some ways to minimize risk.
For example, investing in real estate funds is one of the safest options out there. You offer a certain amount of your money and get access to more considerable sums from other investors.
This allows you to pool resources with others, making it easier to move into the market.
Open an Emergency Fund
You should always have some emergency cash on hand. If you are unable to do so, at least make some cuts to your spending and get rid of those that are not essential. You could also look for methods to increase your income without having to quit your job.
The good idea is to start a side hustle in order to build up your emergency fund. You could work as a freelancer or become a gig worker.
An emergency fund can help you weather unexpected financial hardships, such as a job loss or medical emergency. Having this cushion will give you peace of mind and help you avoid debt.
You should keep enough money to cover your expenses for at least one month. The goal here is to give you enough to save and not fall into a debt cycle.
Sell Your Stuff
Selling your stuff is one of the easiest ways to get extra cash. At first glance, it might seem like a terrible idea since you are losing assets and have nothing to show, but this strategy has a big silver lining.
By selling your stuff, you can reduce the number of things you own and increase your disposable income at the same time. If you are unsure what to sell or how much you can earn from doing so, take a look at the prices of similar items on eBay or in other stores.
You could also try renting out some of your stuff if you do not mind handing it over to a stranger for a while. You never know — this kind of revenue stream could become a significant part of your future income.
The Bottom Line
There are many ways to increase income, but they all require effort. The good thing is that the process of growing a monthly paycheck can be approached as an investment and a smart one at that. Remember, the key is not just to earn more money but also to work efficiently and invest wisely.
The methods described above are only a sample of what is possible. Do not be afraid to experiment with your personal situation, as there are a variety of strategies to combat inflation.
Many banks offer loans with low-interest rates and flexible terms, which can be a great way to get out of debt if you have the money to pay it back. When it comes to investing, many people advise against buying liquid assets and instead focus on non-tradable goods.
Another valuable strategy is to invest in gold bars or coins. The price of this precious metal has been steadily rising for years now, and it might be your best bet against inflation.
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This article was produced and syndicated by Wealth of Geeks.
Josh founded Money Buffalo in 2015 to help people get out of debt and make smart financial decisions. He is currently a full-time personal finance writer with work featured in Forbes Advisor, Fox Business, and Credible.