Inflation remains a hot topic and a significant worry among many US families, especially after October data has shown that the average American household is spending $433 more per month on everyday goods and services.
According to a news release from the US Bureau of Labor Statistics, consumer prices rose 7.7% in October compared to the year before, and although this is down from June’s 9.9%, it is still among the highest since the 1980s.
It’s no secret that while inflation rises, many working wages do not and have not. However, it should be noted that inflation can be personalized and depends on one’s purchases and geographic factors.
When Will Inflation End?
Some experts say the “peak” of inflation is over, and while this may be good news, Americans should remain diligent with spending in the meantime.
The consumer index shows that food alone sits at a 10.9% increase in October compared to last, with food away from home rising to 8.6%. In these same terms, electricity sits at 14.1% and utility gas services at 20%.
Related: The 5 Best Value Stocks for Inflation
Changing the Way We Spend
As these rates may seem nerve-wracking, to combat inflation and ease the burden of stress, individual households and families are encouraged to adjust living expenses and routine habits accordingly.
Generally, this can begin with assessing and distinguishing fixed and discretionary expenses.
Discretionary expenses include the things that you are able to survive without. These can be as simple as eating out, shopping, or vacationing from home.
But before eliminating certain expenses from your household, however, it’s beneficial to discuss what is truly needed and decide what could be lived without for a while.
Fixed expenses don’t necessarily need as much consideration, given that they are usually the expenses that you cannot live without, such as rent, food, transit, etc.
Although, again, it may be essential to discuss the two in order to effectively differentiate and act accordingly when necessary.
If a household cannot eliminate certain discretionary expenses, substitutions can also occur.
This could mean eating out less, rather than cutting out eating altogether, or spending less money shopping than usual.
Other ways American households can cut back on spending or monitor expenses include:
- Tracking spending habits
- Reducing electricity use
- Utilizing coupons for groceries and sticking to a list
- Avoiding non-essential travel
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