You might have noticed that the cost of everything has skyrocketed lately. The price of rent, food, gas, and even your daily cup of coffee is continually going up—and it’s all because the inflation rate is higher than it’s been in 40 years. While that might seem like a hopeless situation, there are ways to save money and take control of your finances.
Really, it’s just a matter of being informed. Know what you’re spending on and why you’re spending it—and where you can find better deals on the things you need. If you’re not sure where to start, check out these tips from finance experts.
1. Assess How Much Money You Spend
One of the first steps to saving money is figuring out where all your money goes. Budgeting apps like Mint and Goodbudget are a great way to streamline this process: Most of these apps will connect with your financial accounts, track your spending, and categorize your purchases.
Nerdwallet’s roundup of budget apps will help you decide which features are most important to you; simply download one or two of them and play around until you find the app that works best for you. From there, you can see if you’re over-spending in any areas and how you can start socking money away for a rainy day.
2. Use Cash for Most Purchases
If you want to make your dollars go farther and avoid getting into credit card debt, use mostly cash for purchases. Cash can be a powerful tool for saving money because it forces you to think about what you’re buying and how much it costs.
When you have only $100 in your wallet, you’ll have a hard time spending that money on anything that’s not absolutely necessary. The same thought process doesn’t necessarily happen if you use a credit card, thinking you’ll buy now and pay later. Even a debit card doesn’t have the same impact as cold, hard cash in your hand.
3. Use Credit Responsibly
Using cash doesn’t mean you have to abandon credit cards altogether. Responsible use of credit enables you to build your credit score, which is important for things like financing a car, renting an apartment, obtaining a mortgage, or even getting a job in some cases. To use credit responsibly:
- Pay off your credit card each month. This way, you’ll never pay interest.
- Even if your card has a 0% interest rate, avoid carrying a balance; 0% rates often expire after an introductory period.
- Use only one card each month for a recurring charge like a phone bill, and set the card to auto-pay for the full balance.
3. Shop Smart
You don’t have to spend a lot of money to eat well, and cooking your own food will dramatically reduce your food bill. Here are some ways to save:
- Buy foods that are on sale and in season. Use grocery chains’ apps for extra savings and digital coupons.
- Buy frozen or canned vegetables. They’re often less expensive than their fresh counterparts.
- Shop local farmer’s markets for deals on the best seasonal produce.
- Go meatless at least once a week. Meat is typically the most costly item on your grocery bill.
4. Sell Your Stuff for Cash
Nowadays, there are plenty of online marketplaces you can use to turn your clothes and other goods into cash and even shop for thrifted threads. Here are some to try:
- Poshmark. A social media platform where you can buy and sell clothing through an easy-to-use mobile app
- Offer Up. A mobile app where you can list a variety of items for sale to local buyers, with an option to ship
- ThredUP.com. An online consignment and thrift store where you can ship your name-brand clothing for resale
- Other online platforms like Facebook Marketplace, Amazon, and eBay
One caveat: When selling to people in real life, meet in a public location, only accept cash for purchases, and don’t give out your personal info.
5. Build an Emergency Fund
Having an emergency fund of at least $1,000 gives you a buffer when unexpected expenses pop up (and they always do). Instead of pulling out your credit card for a car repair, you can dip into your emergency fund and avoid going into debt.
To get started, automate your savings with as little as $5 a week, and watch your savings grow. Consider picking up extra work through side gigs like Uber, Lyft, freelance work, or other jobs in your area of expertise, and put that money directly into emergency savings.
This isn’t meant to be an exhaustive list, but just a snapshot of some of the ways you can save money during times of inflation. Try out a few money-saving methods every month, and you’ll find yourself saving much more than you think.
