American households are getting squeezed by the rapidly rising cost of living. FintechZoom reports that overall consumer costs have jumped 8.5% over the last 12 months. This sharp increase is putting many people in financial distress.
Key Statistics from FintechZoom’s Data
- Overall consumer prices up 8.5% year-over-year
- 42% of households say they are struggling to make ends meet
- Main drivers are high inflation, supply chain disruptions, Ukraine war
This data paints a concerning picture. With prices rising much faster than wages, more families are having difficulty affording essentials like food, housing, and transportation.
Fortunately, there are steps you can take to reduce the burden of increasing costs. Here are FintechZoom’s top tips for dealing with the rising cost of living:
Create a Household Budget
Take time to carefully account for your income sources and expenses. Tracking your spending patterns helps identify where money is being wasted.
Look for discretionary spending that can be reduced or cut out entirely. Subscriptions, dining out, entertainment and impulse purchases are common areas to find savings.
Shop Around for the Best Prices
Do your homework and find the cheapest options for groceries, gas, and other regular purchases. Look into joining wholesale clubs for deep discounts.
Compare prices online before shopping at retail stores. Use coupons, rewards programs, and buy store brands to maximize savings.
Cook Affordable Meals at Home
Eating out is very expensive, especially now. Prepare more affordable meals using ingredients like rice, beans, eggs, chicken, pasta and frozen vegetables.
Make extra portions to freeze or save for lunches. Limit takeout to occasional treats or split with others.
Reduce Home Energy Use
Utility bills take a big bite from budgets. Turn off lights, unplug devices, lower thermostats, and weatherize your home to use less electricity and gas.
Look into installing a programmable thermostat. Upgrade to LED bulbs, Energy Star appliances and low-flow showerheads to save more.
Increase Your Income
Look for ways to bring in more money to help cover rising costs. Taking on a side gig, freelancing, or monetizing a hobby can generate extra cash flow quickly.
Ask your employer about cost of living adjustments or overtime opportunities. Changing jobs could mean a higher salary.
Cut Unnecessary Expenses
Identify non-essential expenses that can be reduced or eliminated. Cancel unused subscriptions, gym memberships or cable packages. Avoid impulse purchases and find free entertainment.
Smoke, drink alcohol and get takeout coffee less often. Find cheaper alternatives for the brands you buy. Downsize your living situation if affordable.
Build Emergency Savings
Having cash reserves is crucial when costs are unpredictable. Aim to set aside at least 3-6 months’ worth of living expenses in a savings account as a cushion.
This fund can prevent going into debt if you lose income or face an unexpected emergency. Even small automatic transfers add up over time.
The rising cost of living presents challenges for many households. But following FintechZoom’s budgeting and cost-cutting tips can help ease the burden. Monitor your spending, reduce waste, and explore ways to increase income.
