6 Ways to Save Money During Inflation

woman calculating money and receipts using a calculator
Photo by Karolina Grabowska

Inflation is hitting everyone’s wallets right now. Most consumer goods and things that we all need for day-to-day life, like gas and electricity, are expensive. Inflation is at record-high levels, and that’s leading a lot of people to tighten up their spending and watch where their money is going more carefully. 

There are things you can do to reign in your budget and spending, whether we’re in a period of high inflation or otherwise, including the following six tips. 

1. Check Your Insurance

Along with the more obvious things, like making sure you don’t speed when you drive, which can raise your insurance premiums, you can also find other ways to save on your insurance. 

For car and home insurance, contact your providers, and see if they offer any special deals if you bundle multiple policies with them. You might also ask them if there are any eligible discounts available. Insurance companies often don’t advertise these special discounts, but if you ask, they’ll let you take advantage. 

Other ways you can save on your car insurance in particular include:

  • Shop around. The prices do vary more significantly between companies than you might initially think. Although, you still have to remember having the lowest price doesn’t automatically mean it’s going to be the cheapest. You want to choose a company that’s going to give you the service and protection you need, balanced against the price. 
  • Consider raising your deductible to lower your premiums. If you have the money set aside to pay the deductible if you have a claim, this is a good way to save money. 
  • If you have an older car, reduce optional coverage. A good rule of thumb to follow is that if you have an older car and it’s worth less than ten times your premium, having collision and comprehensive coverage might not be worthwhile. 
  • If you have a good credit history, it can help you get access to lower insurance costs. A lot of insurers will look at credit information when pricing their car insurance policies. 
  • If you don’t drive much, ask your insurance company about a discount for low mileage. If you drive under the average number of miles per year compared to other drivers, you might be eligible. 

2. Saving At the Grocery Store

The prices of groceries are soaring. Americans spend, on average more than $400 a month on groceries, and it’s only going up. So, how can you save on groceries?

  • Use a groceries reward card. If you use a cash-back card that’s specifically focused on groceries, you might be able to earn as much as 6% back. 
  • Make sure you’re signing up for grocery store loyalty programs, which will give you access to members-only discounts when you check out. 
  • Coupons are an old standby to save money, and they still work. You can also use digital coupons. To access these, download the app for the grocery stores you shop at regularly. 
  • For some people, wholesale clubs make good financial sense, but be careful because buying in bulk isn’t the right option for everyone. If you live on your own or have a small home without a lot of storage, buying in bulk isn’t always optimal. You also have to spend more upfront, so depending on your cash flow, this may not be an option for you. 
  • Create a grocery list and stick with it. You can also do your grocery shopping online and pick it up. This helps you stay on budget. When you shop online, you avoid impulse buys, and you can more easily plan meals and see where all your money is going, rather than getting to the register and facing sticker shock. 
  • Look for store sales. You can sign up for email updates from your favorite places to buy groceries, and sometimes they’ll have major sales on certain items. Then, you can stock up on that and put it in the freezer. 
  • Don’t buy packaged items if you can. For example, rather than buying packaged and already-shredded cheese or pre-cut vegetables, buy the whole items and then prepare them yourself. 

3. Track Your Spending

So many people don’t really know what they have going out versus coming in each month or know where their money is really going. One of the best things you can do for yourself in terms of setting a budget and being smarter with your money is to track your spending habits. 

This will help you gain a better understanding of where you can cut costs and where you might be wasting money. 

You can’t make adjustments until you have a full picture of your spending. 

Once you track your spending, then you can set a budget. You can separate your spending into needs, wants, and goals to keep it simple. Your budget doesn’t have to be overly complicated to be effective. 

4. Look at Your Subscriptions

Every month, there is probably money that you’re paying on a recurring basis, and you don’t even know where it’s going. You might have monthly subscriptions to magazines and publications, apps, weight loss programs, streaming services, and more. 

You want to assess each of these subscriptions and think about how much you’re actually using whatever it’s for and whether you really need it. 

Don’t avoid unsubscribing from something because they make you jump through hoops to do it. 

5. Use Cash

So few people use cash anymore, but it can make you much more mindful of your spending. You can put your monthly expenses on something that’s automated and then anything else you use cash for. This helps to reduce impulse buying because you may not even have the money to pay for what you want in the first place, plus you can budget more easily. 

6. Reduce Your Energy Bills

Finally, the cost of energy is expensive right now and will likely go up this winter. Water and electricity can quickly erode your savings, but there are lifestyle changes you can make. 

During the day in the fall or winter, term your thermostat down seven to ten degrees during the day. Turn it up during spring and summer. This can save you around 10% on your energy costs. 

Only run your dishwasher when it’s full and use your smaller appliances like your toaster oven for smaller meals.

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