There’s no denying that most of the world is in the midst of a cost-of-living crisis. Monthly expenses have skyrocketed in recent years, with most American households now spending an extra $433 per month to make ends meet. While it may not sound like much, the reality is that most people’s salaries have not kept up with inflation rates, with some actually dropping under inflation lines, leaving millions of people out of pocket. So, obviously, the question on all our minds is, how do we cut back on expenses to survive the inflated costs of living we all face? Let’s take a look at some practical ways to lower your spending that’ll bring some relief right away.
Table of Contents
Why has the cost of living gone up?
Our economy has been through a really tumultuous couple of years, weathering a global pandemic, political instability and a war that has had global repercussions. This instability has driven inflation rates up to a 40-year high that has in turn, pushed up the Consumer Price Index. For example, in October 2022, food prices had increased almost 96%, the cost of staples such as eggs and butter increased 43% and 33% respectively, and gasoline increased by 17%. When you examine the results published by the US Bureau of Labor Statistics, the majority of household staples and utility costs have all risen significantly which has put financial pressure on most households around the country.
5 effective ways to decrease spending
The best way to weather the current financial storm is to be proactive with budgeting and cutting back on spending. Here are five smart ways to start saving more money today:
-
Limit unnecessary spending
It’s hard to kiss the little luxuries goodbye but if you really examine your budget, you’ll realize there are a lot of areas you could actually be saving money. Start with checking through all your subscriptions and figure out which ones you really need. For example, cancel a pricey gym membership and join a community jogging group or download free training plans instead. Instead of paying for an expensive digital magazine membership, read your news on the thousands of free sites available to you.
-
Carpool
As fuel prices continue to shoot up, everyone who owns a car has begun to feel the pinch. Driving from A to B now costs a lot more than it did a few years ago and it has forced us to rethink our miles. Whether you need to commute to work or find a more economical way of getting the kids to school, chat to your co-workers or kid’s classmates and work out a carpooling schedule so you’re cutting back on fuel costs. As an added bonus, with less vehicles on the roads, carpooling can ease traffic congestion and reduce greenhouse gas emissions.
If carpooling isn’t an option, plan your route carefully and try to run all your errands in one trip rather than going out multiple times a day.
-
Look for deals
If you’ve never been a bargain shopper, you’ve been missing out! There’s a real thrill in chasing and finding the best deals and saving tons of money doing it. While most household goods have gone up in price, that’s not to say you can no longer have eggs for breakfast. With a little detective work, you can find incredible deals on essential and luxury items so you don’t need to change your lifestyle entirely. You could also keep an eye out for online promos and discount codes to decrease the cost of your purchases.
-
Make your home more energy efficient
As per the CPI, the costs of electricity and gas have all gone up significantly, so it’s important to try to make your home as energy efficient as possible to reduce your monthly bill. This can be done through a number of initiatives:
- Switch all your bulbs to energy-saver LEDs
- Put a timer on your boiler or switch to a gas boiler
- Install a gas oven and stove
- Don’t use your appliances, such as kettles, dryers and ovens, during peak usage periods
- Boil your hot water for the day and keep it piping hot in an insulated flask so you don’t have to keep boiling the kettle
-
Buy preloved
If it’s been a while since you checked out Facebook Marketplace, Poshmark and eBay, you might be surprised at the gems you can find on these platforms. You can find a bunch of name-brand items at a fraction of the price and in excellent condition that nobody else will be able to tell were bought secondhand.
Final thoughts
It is more important than ever to rein in your spending and save money where you can. The economy will recover and improve in time but for now it is necessary to weather the rocky financial storm to come out the other end unscathed.
