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Tips to Combat Inflation

The U.S. is currently experiencing the highest inflation levels since 1990, with a 6.2% spike in prices for consumer goods. As a result, Americans are experiencing a decline in their spending power, and voicing their concerns about the future of their finances. How can you combat inflation?

Invest smartly in your retirement plan.

Don’t neglect long-term savings like your retirement funds, which take advantage of compounding. Always diversify your investments in order to combat inflation. If you want to go the extra mile, consider investing in stocks that perform well during an inflationary period such as food, health care, and energy. Need some help? Book an appointment with our investment services team to see where you stand.

Emergency funds are key.

Open a separate savings account and set aside three to six months of living expenses that is used for emergencies only. We recommend opening a high-yield savings account which earns 0.70% APY* interest on your money*. Or, our RollUp savings account makes saving effortless as it automatically rounds each purchase up and puts it into a savings account.

Review your spending habits.

Keep tabs on your spending and consider taking a break from non-essential expenses. Stretch your budget to make your dollar go further by shopping at bulk stores like Sam’s Club or Costco. As an Alltru member, you can save 40% on a Sam’s Club Membership! There are many free budgeting apps to help you such as Mint, Pocket Guard, and Goodbudget.

Buy instead of rent.

When you rent, landlords can increase your rent to match the inflation levels – which is nice when inflation is low, but problematic when prices start to rise. As a homeowner, fixed mortgage payments protect you from inflation. Plus, the value of your home will rise during times of inflation. Use our Rent or Buy Calculator to see where you can save.

Free up cash by refinancing.

Mortgage rates have bounced from their pandemic-era lows, but homeowners might still be able to find an offer on the market that’s better than what they’re currently paying. Refinancing your mortgage could potentially shave hundreds of dollars off your monthly payment, freeing up crucial cash in a high inflationary environment.

Bottom line

It’s still hard to tell if the current spike in inflation is likely to last or if it will start to recede. If you’re concerned about rising inflation, consider taking this advice to safe guard your finances.

*APY=Annual Percentage Yield. See High Yield Savings Account features and disclosure.

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