It’s no secret that inflation is happening and making finances tighter for many families. This also means that savings accounts are having to be dipped into and putting money into savings may be non-existent these days which could ultimately affect your plans for retirement and seemingly even extend the amount of time before you are able to retire! Here are 5 ways to plan ahead and not let inflation negatively affect your retirement plans:
1. Put money into savings first!
While it can be tempting to let your paychecks burn a hole in your pocket and spend it all as if it never existed to begin with, the key to not allowing inflation to affect your retirement savings is to put money in savings FIRST, before spending it on other items. This way, you will not “run out of money” before being able to put some away in savings.
2. Pay down any debt.
If you have credit card debt, student loan debt or any type of debt really, it is likely in your best interest to decrease or pay this debt off in full before putting money into savings. This is because typically there is interest that accumulates with debt and can only worsen the overall amount of money you will eventually have to pay, cutting into your savings even more! Check out this blog with seven ways to help you pay down debt: https://npfba.org/blog/7-basic-strategies-for-paying-down-debt/
3. Consider a secondary source of income.
If you have the time and energy and are willing to try, “side gigs” can be easy and beneficial ways to curb the impact of inflation on your savings for retirement by allowing you to make even a small amount more to stash away. Some examples of simple side gigs could be: a dog walker, becoming an Uber or Lyft driver, reselling clothes using apps like Poshmark or LetGo, or even taking paid surveys on websites such as Survey Junkie. While these side hustles may not generate a ton of extra income, you can think of any extra income as a benefit to your savings account and eventually for retirement.
4. Give up brand names.
During inflation especially, prices on items like food skyrocket. During this time, one of the easiest ways to save an extra few dollars is to give up brand name items. Check out the store brand of the same items you typically buy, they are usually at least slightly cheaper and commonly are made of the same ingredients and even the same quality! Brand name items can charge more simply because they slap their name on an item.
5. Take advantage of sales and coupons.
If there was ever a time to spend the extra few minutes coupon clipping, it is now! At times, coupons and store sales can help you save a good amount of money on groceries or home items. While it may not seem like a lot at the time, these savings can add up and allow you to put that extra $100 in savings in a month or two.
6. Grow your own food!
Growing your own fruits and vegetables can be a great way to save money and put that extra few dollars in savings for retirement. With inflation making groceries so expensive, it makes sense that spending a few dollars on seeds once, can save you loads of money later on fruits and vegetables. Gardening is also a great and relaxing outdoor activity to help with mindfulness and stress relief. Check out this blog on seven other ways to get outside with your family without breaking the bank: https://npfba.org/blog/16-affordable-ways-to-get-outside-with-your-family/
While inflation is scary and can really affect your savings and retirement plans, there are simple changes you can choose to make daily to avoid this, plan ahead and still continue saving money for your retirement.