2863: 8 Tips to Cope with the Rising Cost of Living by Lisa Harrison of Mad Money Monster on Budgeting

[00:00:00] [SPEAKER_00]: Have you ever noticed how a calm mind can really set the stage for a good night's sleep?

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[00:00:36] [SPEAKER_00]: the one from Optimal Living Daily. This is Optimal Finance Daily, 8 Tips to Cope with

[00:00:44] [SPEAKER_00]: the Rising Cost of Living by Lisa Harrison of MadMoneyMonster.com. And I'm your host and

[00:00:51] [SPEAKER_00]: personal finance enthusiast, Dianna Merriam. Now let's get right to it and continue optimizing

[00:00:56] [SPEAKER_00]: your life. 8 Tips to Cope with the Rising Cost of Living by Lisa Harrison of MadMoneyMonster.com.

[00:01:10] [SPEAKER_00]: It's becoming increasingly expensive simply to be alive in the modern world. The cost of

[00:01:16] [SPEAKER_00]: everything is rising rapidly at the moment, from petrol and household energy bills to groceries

[00:01:23] [SPEAKER_00]: and luxury goods. These sharp price hikes have a myriad of causes, among which are the lingering

[00:01:31] [SPEAKER_00]: effects of worldwide issues related to the pandemic and unrest across the globe. And many

[00:01:37] [SPEAKER_00]: people are feeling the impact when it comes to their ability to put food on the table and

[00:01:42] [SPEAKER_00]: provide for their families. If you're struggling to make ends meet right now, you're not alone.

[00:01:47] [SPEAKER_00]: The cost of living in the US has risen by 14% over the past three years, and around 71% of

[00:01:55] [SPEAKER_00]: Americans claim their paycheck is not enough to match the current levels of inflation.

[00:02:00] [SPEAKER_00]: Hopefully, the world will return to some semblance of normal in the near future,

[00:02:06] [SPEAKER_00]: and costs will subside to a more manageable level. But what can you do in the meantime

[00:02:11] [SPEAKER_00]: to live more comfortably? Fortunately, there are many ways that regular people can manage

[00:02:17] [SPEAKER_00]: their finances and reduce their outgoings in order to survive the cost of living crisis.

[00:02:23] [SPEAKER_00]: Here are 8 tips to get you started.

[00:02:26] [SPEAKER_00]: Number 1. Create a budget. One of the most effective ways to take control of your finances

[00:02:33] [SPEAKER_00]: and reduce your cost of living is to create a household budget. This can be as simple as an

[00:02:39] [SPEAKER_00]: Excel spreadsheet, but if you prefer all the bells and whistles, there are numerous apps and

[00:02:45] [SPEAKER_00]: software programs related to money management. Your budget should outline all of your household's

[00:02:51] [SPEAKER_00]: income as well as your essential and non-essential outgoings each month. This will give you an

[00:02:57] [SPEAKER_00]: idea of where your money is going, and help you to work out where to make significant savings.

[00:03:03] [SPEAKER_00]: Number 2. Cut out unnecessary expenses. When times are tough, you may need to make sacrifices

[00:03:10] [SPEAKER_00]: in your life. Is there anything you're spending money on that you could reasonably put on hold?

[00:03:16] [SPEAKER_00]: Perhaps you can pause your monthly gym membership and start going for runs and

[00:03:21] [SPEAKER_00]: working out at home instead. Maybe you could cancel that streaming service and share a

[00:03:26] [SPEAKER_00]: password with a friend. Scrutinize your outgoings and be honest with yourself about

[00:03:32] [SPEAKER_00]: what you really need to be paying for. Number 3. Find cheaper alternatives.

[00:03:38] [SPEAKER_00]: By finding less expensive versions of the things you already spend money on,

[00:03:43] [SPEAKER_00]: you can make big savings without really noticing it. Maybe you can switch your regular grocery

[00:03:49] [SPEAKER_00]: store for the slightly cheaper one a few miles down the road. Or you can cut out

[00:03:54] [SPEAKER_00]: your morning Starbucks and bring your own coffee to work instead. Number 4. Look for

[00:04:00] [SPEAKER_00]: discounts. It's good practice before making any purchase to see if there are any discounts

[00:04:07] [SPEAKER_00]: available. Many online stores offer savings to customers in return for signing up to their email

[00:04:13] [SPEAKER_00]: mailing lists. So do your research before parting with your money. Do your grocery

[00:04:19] [SPEAKER_00]: shopping at the end of the day, when there are often last-minute price reductions on fresh goods.

[00:04:26] [SPEAKER_00]: Soon you'll get into the habit of being a savvy shopper and you'll really notice

[00:04:31] [SPEAKER_00]: the difference in your bank balance. Number 5. Save money on fuel.

[00:04:37] [SPEAKER_00]: One of the biggest expenses for most people right now is fuel. With the fighting in Ukraine

[00:04:43] [SPEAKER_00]: and restricted access to global oil, the price of fueling your vehicle has skyrocketed in

[00:04:48] [SPEAKER_00]: recent months. But instead of filling up at an extortionate price from the most convenient gas

[00:04:54] [SPEAKER_00]: station, there are ways to save yourself a great deal of money. For a start, there are

[00:05:00] [SPEAKER_00]: numerous websites that allow you to compare the price of fuel at a range of local four-quarts.

[00:05:06] [SPEAKER_00]: You can pick the cheapest one and obtain petrol as cheaply as possible. It's also effective to

[00:05:12] [SPEAKER_00]: avoid filling your tank to its maximum limit, as this serves to make your car heavier and less

[00:05:17] [SPEAKER_00]: fuel efficient. Instead, it's best to fill it between 50 and 75 percent of its capacity.

[00:05:24] [SPEAKER_00]: The way in which you drive also impacts the amount of fuel you use,

[00:05:28] [SPEAKER_00]: and you should avoid speeding or accelerating rapidly. Drive in a smooth and steady manner,

[00:05:35] [SPEAKER_00]: and try to read the road ahead of you to avoid braking suddenly. Turn off your engine when

[00:05:40] [SPEAKER_00]: stationary and plan your journeys in advance to avoid heavy traffic. Number 6. Reduce your

[00:05:47] [SPEAKER_00]: energy bills. Household energy bills are another major expense in people's lives right now,

[00:05:54] [SPEAKER_00]: and fortunately, there are many things you can do to lower them.

[00:05:58] [SPEAKER_00]: Turning off vampire appliances that drain power even when not in use is a good place to start.

[00:06:05] [SPEAKER_00]: Switch off TVs, microwaves, kettles, and phone chargers at the wall,

[00:06:10] [SPEAKER_00]: and you'll prevent them from hiking up your utility bills. Rather than instinctively

[00:06:15] [SPEAKER_00]: switching on your heating in winter or AC in summer, find alternative ways to stay cool or

[00:06:22] [SPEAKER_00]: warm. Number 7. Increase your paycheck. Those who earn more will likely struggle less with

[00:06:30] [SPEAKER_00]: the rising cost of living, so perhaps there's a way you can increase your paycheck. If you've

[00:06:35] [SPEAKER_00]: worked in your job for a long time, you may be able to ask your boss for a pay raise or

[00:06:40] [SPEAKER_00]: a promotion. If you've been on the fence about quitting your current employment, it may

[00:06:45] [SPEAKER_00]: be worth searching for other jobs where you can earn a little more.

[00:06:50] [SPEAKER_00]: And number 8. Find additional sources of income. There are many people who supplement their

[00:06:56] [SPEAKER_00]: paycheck from their day job with additional side hustles that bring in a significant pass

[00:07:01] [SPEAKER_00]: of income. If you have a spare room in your home, maybe you could set up an Airbnb account

[00:07:07] [SPEAKER_00]: and take in guests for a rental fee. You could also dabble in investments and make money

[00:07:12] [SPEAKER_00]: from stocks or cryptocurrency if you believe in its future and fundamentals. Just do your

[00:07:18] [SPEAKER_00]: crypto research, because obviously not all cryptocurrencies are created equal.

[00:07:24] [SPEAKER_00]: In conclusion, there are so many ways to reduce your outgoings and make a little

[00:07:28] [SPEAKER_00]: more money to help you cope with the rising cost of living. Although it may be tough at

[00:07:33] [SPEAKER_00]: times, it's important to remember that we're all in this together. You just listened to the

[00:07:45] [SPEAKER_00]: Most of Living by Lisa Harrison of MadMoneyMonster.com, and I'll be right back with my commentary.

[00:07:52] [SPEAKER_00]: Buy low, sell high. Buy low, sell high. It's a simple concept, but not necessarily an easy

[00:07:59] [SPEAKER_00]: concept. Right now, high interest rates have crushed the real estate market. Prices are

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[00:08:48] [SPEAKER_00]: dot com slash OFD. This is a paid advertisement. I think the first step in navigating increasing

[00:08:57] [SPEAKER_00]: inflation rates is to simply live below your means as a standard. If you're used to having

[00:09:04] [SPEAKER_00]: a healthy gap between your income and expenses in a high inflationary environment, you could

[00:09:10] [SPEAKER_00]: change nothing and simply save a little less than you planned. But if you're used to living

[00:09:16] [SPEAKER_00]: below your means, you likely have the skill of flexibility. For example, after COVID, the hot

[00:09:23] [SPEAKER_00]: yoga studio I like substantially increased the cost of their monthly membership. Rather than

[00:09:29] [SPEAKER_00]: just accepting it, I ended up signing up for their trade program where I cleaned the studio

[00:09:34] [SPEAKER_00]: for two hours a week in exchange for a free membership. The increased cost pushed me to

[00:09:41] [SPEAKER_00]: find a solution that ended up saving me money overall. Similarly, at the grocery store,

[00:09:48] [SPEAKER_00]: I noticed that beef prices were through the roof, but pork was much more affordable.

[00:09:53] [SPEAKER_00]: So we started eating more pork, which pushed me to try different recipes and stumble upon

[00:09:59] [SPEAKER_00]: some family favorites I probably wouldn't have tried otherwise. We can't control how much

[00:10:06] [SPEAKER_00]: we can control how we respond to it. Knowing that we can be flexible and that we're creative

[00:10:12] [SPEAKER_00]: in getting our needs met builds confidence that we can navigate whatever life throws at us.

[00:10:19] [SPEAKER_00]: And that'll do it for today and another installment of Optimal Finance Daily.

[00:10:23] [SPEAKER_00]: Have a happy Thursday. Thank you for being here every day and listening,

[00:10:27] [SPEAKER_00]: and I'll see you tomorrow as usual where your optimal life awaits.