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It is becoming increasingly expensive simply to be alive in the modern world. The cost of everything is rising rapidly at the moment, from petrol and household energy bills to groceries and luxury goods.
These sharp price hikes have a myriad of causes, among which are the lingering effects of worldwide issues related to the pandemic and unrest across the globe. And many people are feeling the impact when it comes to their ability to put food on the table and provide for their families.
If you are struggling to make ends meet right now, you are not alone. The cost of living in the US has risen by 14% over the past three years, and around 71% of Americans claim their paycheck is not enough to match the current levels of inflation.
Hopefully, the world will return to some semblance of normal in the near future, and costs will subside to a more manageable level, but what can you do in the meantime to live more comfortably?
Fortunately, there are many ways that regular people can manage their finances and reduce their outgoings in order to survive the cost of living crisis. Here are eight tips to get you started.
1. Create a budget
One of the most effective ways to take control of your finances and reduce your cost of living is to create a household budget. This can be as simple as an Excel spreadsheet, but if you prefer all the bells and whistles there are numerous apps and software programs related to money management. Your budget should outline all of your household’s income as well as your essential and non-essential outgoings each month. This will give you an idea of where your money is going and help you to work out where to make significant savings.
2. Cut out unnecessary expenses
When times are tough, you may need to make sacrifices in your life. Is there anything you are spending money on that you could reasonably put on hold? Perhaps you can pause your monthly gym membership and start going for runs and working out at home instead. Maybe you could cancel that streaming service and share a password with a friend. Scrutinize your outgoings and be honest with yourself about what you really need to be paying for.
3. Find cheaper alternatives
By finding less expensive versions of the things you already spend money on, you can make big savings without really noticing it. Maybe you can switch your regular grocery store for the slightly cheaper one a few miles down the road. Or you can cut out your morning Starbucks and bring your own coffee to work instead.
4. Look for discounts
It is good practice before making any purchase to see if there are any discounts available. Many online stores offer savings to customers in return for signing up to their email mailing lists, so do your research before parting with your money. Do your grocery shopping at the end of the day when there are often last-minute price reductions on fresh goods. Soon, you will get into the habit of being a savvy shopper and you will really notice the difference in your bank balance.
5. Save money on fuel
One of the biggest expenses for most people right now is fuel. With the fighting in Ukraine and restricted access to global oil, the price of fueling your vehicle has skyrocketed in recent months. But instead of filling up at an extortionate price from the most convenient gas station, there are ways to save yourself a great deal of money. For a start, there are numerous websites that allow you to compare the price of fuel at a range of local forecourts. You can pick the cheapest one and obtain petrol as cheaply as possible.
It is also effective to avoid filling your tank to its maximum limit, as this serves to make your car heavier and less fuel-efficient. Instead, it is best to fill it to between 50 and 75% of its capacity. The way in which you drive also impacts the amount of fuel you use, and you should avoid speeding or accelerating rapidly. Drive in a smooth and steady manner, and try to read the road ahead of you to avoid braking suddenly. Turn off your engine when stationary, and plan your journeys in advance to avoid heavy traffic.
6. Reduce your energy bills
Household energy bills are another major expense in people’s lives right now, and fortunately there are many things you can do to lower them. Turning off “vampire appliances” that drain power even when not in use is a good place to start. Switch off TVs, microwaves, kettles and phone chargers at the wall and you will prevent them from hiking up your utility bills. Rather than instinctively switching on your heating in winter or A/C in summer, find alternative ways to stay warm or cool.
7. Increase your paycheck
Those who earn more will likely struggle less with the rising cost of living, so perhaps there is a way you can increase your paycheck. If you have worked in your job for a long time, you may be able to ask your boss for a pay rise or a promotion. If you have been on the fence about quitting your current employment, it may be worth searching for other jobs where you can earn a little more.
8. Find additional sources of income
There are many people who supplement their paycheck from their day job with additional side hustles that bring in a significant passive income. If you have a spare room in your home, maybe you could set up an Airbnb account and take in guests for a rental fee. You could also dabble in investments and make money from stocks or cryptocurrency if you believe in its future and fundamentals – read these crypto staking tips to get you started. Just do your crypto research, because, obviously not all cryptocurrencies are created equal.
In conclusion, there are so many ways to reduce your outgoings and make a little more money to help you cope with the rising cost of living. Although it may be tough at times, it’s important to remember that we’re all in this together.
