Inflation: Economists expect the worst won’t start until this summer

HOUSTON, TX (KTRK) – The rising cost of housing, cars and food is causing high inflation that reduces how far our salaries go. Economists predict that the worst of it won’t start until this summer for some essential products, and higher prices could persist for up to two years. But you have a window of time now to craft a strategy for moving forward with the worst of it.

Here are five things you can do now if your household income is less than $70,000 a year.

  • Postpone unnecessary expenses such as buying a new car or remodeling your home.
  • Consider changing a room or roommate. Perhaps you are renting at the time you should buy, or vice versa.
  • Cut down on non-essentials like coffee or lunch out, beauty services like nails, hair and teeth whitening, streaming services or additional apps.
  • Rework your grocery list and cut back on fish and meat in favor of more carbohydrates like pasta, rice, and potatoes. Try buying in bulk with a friend or other family.

Here are five things you can do if your household income is $70,000 – $110,000 a year.

  • Pay off credit card debt, which often has an interest rate of between 12 and 18 percent. Call them and ask if they will lower the interest rate if you are a loyal and on time customer.
  • Make sure you have at least a small emergency fund in place because you may be surprised by the increased necessary expenses.
  • If you’re investing, check to make sure your bond’s rate of return is in line with inflation. Otherwise, it may be a good time to move to more stocks or bonds such as Series 1 savings bonds by the Treasury, which allow you to take advantage of inflation.
  • And if you’re saving for your kids’ future college fund, this might be a place you can cut back on right now if your kids are young, and instead use that money for a family emergency fund.
  • Reevaluate your housing bill, this is not the time to overspend on housing. Most people can afford a home that costs twice their annual income if they have average debt, but three times their annual income if they don’t have debt. Don’t lock yourself up in a high bill and waste a lot of wiggle room for unexpected expenses.

Kaffee Slaughter is a wealth advisor to Bank of America and advises all of us to pay cash for whatever we can now.

“It’s mental, it’s psychological,” she said. “If you’re using cash, you’re very aware.” “So my real advice is, know your cash position and use cash to pay for things today. Because that interest and that rate of interest eat up the cash you have to pay anyway.”

For more tips on saving money during inflation, follow Gina Gaston at Facebook social networking siteAnd Twitter And Instagram.

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