Barbara O’Neill, Ph.D., CFP®, AFC®
Distinguished Professor and Extension Financial Management Specialist Emeritus
Rutgers Cooperative Extension
With food, gas, and energy prices at historic highs in recent months, American families are struggling to adjust their budgets to make ends meet. According to Parul Jain, associate professor of professional practice at the Rutgers Business School in Newark and New Brunswick, the average household is paying about $315 a month more than it did last year for the same "basket" of goods.
Rutgers Cooperative Extension's webinar on inflation-fighting hacks (YouTube video) contains dozens of ideas to cope with inflation in 10 different product purchase categories. Not every idea will work for every person. The idea is to pick the ideas that best fit your budget and lifestyle.
Below is a summary of some ways to fight back against inflation:
Groceries- Make product substitutions (e.g., store and generic brands or alternative ingredients), eat more meatless meals, stock up on sale items, consider shopping at a warehouse store, eliminate high-cost "junk" food snacks and beverages, and use coupons and double coupons from newspaper ads and online web sites.
Eating Out- Drink water with a meal instead of soft drinks or alcoholic beverages, share an entrée or a dessert with someone and split the cost, eat an appetizer as a meal (ask about the size first), select BYOB restaurants for meals with adult beverages, eat out for lunch, "linner " or "early bird specials," bring "to go" containers to take leftovers home for another meal, and simply eat less food (e.g., skip an appetizer or order a smaller portion).
Gasoline- Drive less by consolidating trips, consider carpooling with others, find less expensive gas using online apps such as Waze and GasBuddy, pay for gas with cash, join a supermarket fuel rewards program for gas discounts, time your fill-ups (some experts say Sunday and Monday are the best days and Thursday is the worst), check your tire pressure, and remove unnecessary items that do not need to be carted around.
Road Trips-Vacations- Stay at hotels with free breakfast and/or snacks when on road trips, pack snacks and beverages when driving, try to eat out only once a day, get restaurant and hotel coupons at highway rest stops, travel with a group and share expenses, travel at "off-peak" times (e.g., "shoulder season"), join hotel and airline rewards programs for free rewards, and consider daycations and staycations to save on gas.
Utilities- Adjust the thermostat (a bit warmer in summer months) and use ceiling fans, turn down the water heater from 140° to 120°–130°, unplug items not in use by using a power strip, take advantage of "off-peak" electricity rates and time-of-day meters, change HVAC system air filters regularly, use LED light bulbs, wash (most) laundry in warm water, empty the dryer lint trap after every load, and switch to low-flow showerheads.
Clothing- Shop department store and online merchant sales, use retailer coupons, join retailer loyalty programs to earn rewards, shop at thrift and consignment shops and online secondhand clothing websites, use hand-me-down clothes from others, make simple clothing repairs and alterations, and buy fewer clothes and shoes.
"Big Ticket" Items- Wait to buy items with big price increases if you can (e.g., cars and computers), compare at least three product or service vendors before making a purchase, and compare at least three financing options.
"Shrinkflation"- Recognize that some product manufacturers are "hiding" price increases by reducing the quantity of a product. The best workarounds are to pay attention to package sizes and unit prices, wait for sales and stock up, and buy fewer pre-packaged foods (prone to shrinkflation) and more store brands.
For more expense-cutting tips to combat inflation, review the CFPB publication (PDF) Cutting Expenses.