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It’s back to school time! Elementary school kids are getting new clothes and school supplies. High schoolers are doing the same, especially those who participate in fall sports and are gearing up for a new season. College students are winding down their summer jobs and returning to campus. And those that pay all the bills are finding out it’s costing more than last year.
School supplies cost more. Athletic gear and equipment cost more. And everything associated with college, from books to housing to transportation, costs more. And, oh yeah, tuition.
I think it’s safe to say that virtually everything costs more than it did last year. And there’s no apparent reason to think prices will start falling any time soon. At best, we can hope they won’t continue to escalate.
I have little doubt that many households are under some serious financial pressure. Studies are showing that many families are struggling and juggling their budgets just to keep their heads above water. Many are forced to cut back, or even eliminate, saving for college and contributing to their retirement fund. Not good.
But trying to get through today’s bills and being forced to put tomorrow’s goals on hold is a reality for many. For anyone in that situation, I strongly encourage you to review both your fixed and your lifestyle expenses. Utilities. Car payments. Causality insurance. Are you using the best deductibles? Buying or leasing too much car? Taking advantage of automatic payment plans? Keep looking. Study hard. You will find something. And every little bit helps.
Lifestyle expenses, on the other hand, are much easier to control. Because they are discretionary and it’s your discretion. How much you shave off is up to you. How many of those streaming services do you really need? Can you cap it at two and maybe read a book? Do you really need to stop for that special $2 an ounce Frappuccino supreme? You can buy a thermos for that amount and take with. Fortunately, I’m seeing signs that people are making an effort to cut back. Like long lines at discount gasoline stations. More people shopping at discount chains rather than the name brands. And especially crowded parking lots at the dollar stores. Yes, I know. But still.
I think most people get it and are making appropriate adjustments to their lifestyles. And I know that subtle changes can add up to significant savings over time.
Now let’s say you live comfortably within your budget and have funds invested for retirement. Good job. But those monies are also affected by inflation and need to be protected. Long-term money, dollars you don’t anticipate spending within the next 36 months, should be in banks and credit unions earning interest.
For monies needed at a later timeframe, consider investing in something that can potentially keep up with inflation. There are investment vehicles ranging from low risk to highly speculative, so it’s going to require some research on your part. Utilizing the expertise of a financial professional is also advised.
The recent surge in prices is a reminder why investing for the long term is so important. If you’re feeling the pain, review your expenses and lifestyle. Nobody knows what tomorrow will bring, but we’re all in it together.
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