Inflation is at a 40-year high, according to the March consumer price index.1 Many Americans are seeing the effects of inflation at the pump, the grocery store, and at home, with low-income households feeling the greatest impact. From side gigs to credit card points and cash back, there are many ways to combat the current price hikes.
5 wallet-friendly tips during inflation
1. Reevaluate existing budgets
When money is tight, the first place a person should look for relief is their budget. During inflation, they may have to give up some luxuries to make room for swelling costs in other categories, at least temporarily. For example, while someone may have been able to afford eating out three times a week pre-inflation, it may be best to cut that down to once per week until conditions improve.
Tip: Keep track of spend per category and create a budget with Money Management, an easy-to-use online tool available for free to General Electric Credit Union (GECU) members enrolled in Online Banking or our mobile app.2
2. Expand money channels
While a part-time job is a fantastic way to make extra money, a side hustle doesn’t have to be traditional employment. Some other options include:
- Selling unneeded items. There are many apps and websites available to sell home goods, electronics, clothes, and more. Take stock of closets for unwanted clothes, look in the basement for rarely used electronics, and scope old nick knacks that won’t be missed.
- Negotiating a raise. The “Great Resignation” has many companies upping their retention efforts. If employees have the leverage, they should consider negotiating a raise to increase their income.
- Putting skills to use. Good with a paintbrush? Sell art online. Love kids? Consider babysitting for family, friends, and neighbors on the side.
3. Use coupons
Many retailer apps give users easy access to digital coupons that can be used online or in-store. Shoppers with a favorite store should consider downloading these apps to help curb the inflation price hikes on their favorite items.
4. Take advantage of credit card perks
The best credit cards let accountholders earn points or cashback on purchases they were going to make anyway. Points can often be redeemed for things like gift cards, merchandise, and even cashback. At some financial institutions, a purely cashback card will take earnings and apply it to the card’s statement balance. Both options can help consumers recoup the cost of shopping during inflation.
Tip: Open a GECU Platinum card to enjoy 3x the points at U.S. supermarkets and wholesale clubs, 2x the points at gas stations, and one point for all other purchases.3
5. Pay down variable-rate debt
While interest rates aren’t directly affected by inflation, economic conditions are a factor lenders consider when determining interest rates. Because of this, borrowing may get more expensive on certain variable-rate products, like credit cards. Tackle any variable-rate debt during inflation to avoid potentially higher interest payments should these conditions continue in the future. Keep in mind, though, it’s always beneficial to pay off a credit card balance in full each month regardless of economic conditions. This is because cardholders will have to pay interest on any balance they roll over, giving debt an opportunity to snowball.
Tip: Learn more about the federal funds rate and its impact on consumer interest rates in What Do Rising Rates Mean for Your Money?
GECU is here to support members during inflation. In addition to Money Management and credit card points and cashback, members can depend on complimentary resources and support including: our Money Minutes blog, on-demand webinars, and no-cost consultations with a Financial Counselor. Plus, eligible loan accountholders can opt to Skip-a-Pay up to twice per calendar year! Simply submit a request online to free up money for other necessities this month.