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Navigating through financial changes amid inflation
The government's report that came out this week that inflation has climbed to 9.1% has more consumers facing some really tight finances and quite frankly, just worried about a possible recession. FOX 26 Business Reporter Tom Zizka looks at how to navigate some of those financial changes.
HOUSTON - The government's report that inflation has climbed to 9.1% has more consumers facing tight finances and concerns about a recession.
From food to fuel, it's hard to find something that isn't getting more expensive. A recent financial analysis finds inflation costs the average American an extra $460 a month, and no one knows when it will come to an end.
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Personal finance expert Bobbi Rebell, from the credit management app Tally, says with inflation the highest it's been in four decades, a lot of consumers have little experience navigating a whole host of financial pressures that can seem out of their control.
"It is something many of us weren't, necessarily, prepared for financially or just in terms of our mindset," she says.
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But Rebell says there is a path, starting with inflation. For many, it's time to start cutting whatever expenses they don't need. Many vital products are up double-digit percentages, over a year ago. So, before making a purchase, decide what you really need and whether it's at the absolute best price.
"I think the average consumer is in a bind here and has to be a lot more proactive and intentional when they purchase anything," says Rebell.
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Next, let's assume an adult child moves back into the house. Rather than a free ride that strains your budget, maybe there's some rent involved, or groceries, or some other effort to share the load.
"Have conversations with your adult child, when they move home, (and) make sure they understand what the rules are; what at your expectations are; what your hopes are, for them," says Rebell. "And also what they are expected to contribute to the household."
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Finally, what if your income drops, or stops? For most, that means a job search. However, unless there's a good cushion for emergency expenses, Rebell suggests a willingness to be creative.
"Think about the skills you have, that can generate cash to keep your household going and pay your expenses while you look for your realistic dream job," she explains.
In a pinch, you can also take a good look around the house and decide if there are things you can 'sell' to make some money. Whatever the choice, as we look for ways to cut back and stretch our budgets, Bobbi Rebell encourages consumers to be 'open-minded' to things that they might not normally consider.