How to Save Your Budget With Inflation Running Hot
“As inflation has broadened, it’s going to be much more difficult to do an inflation dodge,” said Nela Richardson, chief economist at ADP. “It’s unlikely that prices are going to go down. The best we can hope for is a rapid deceleration of price increases.”
But there are strategies consumers can deploy to lessen the pain. Here’s advice from financial advisers and market experts on how to navigate the latest inflation numbers:
Focus on What You Can Control
A common — and commonly derided — tip for dealing with inflation is to tell people to simply consume less. Politicians and companies that have made such suggestions over the past few months have been lambasted by critics as being out of touch.
While cutting back might make sense sense in theory, it’s much more difficult in practice to reduce spending on essentials like food or energy, which saw prices surge 9.4% and 30.3% year-over-year, respectively.
“For most folks, it’s not reasonable to ask them to not use those things. They’re everyday necessities,” said Ross Mayfield, an investment strategy analyst at Robert W. Baird & Co.