BUFFALO, N.Y. — So you just sat down to pay the monthly bills and you're wondering where all your money went. Nowadays you barely have enough left over for pizza and wings with the kids.
Guess what, you are not alone, it's happening right now to the majority of Americans. But don't panic, here are several relatively easy things you can do to help you beat this historic inflation rate.
First things first, make sure you have a monthly budget, the experts say a budget puts YOU in control.
"You need to know what's coming in and what's going out
anything above and beyond what your actual expenses are then you're prioritizing saving and investing giving every single dollar a home," said Russ Gaiser, a financial advisor with The Financial Guys in Amherst.
Next avoid having excess cash sitting in a bank account.
"Your bank account is essentially designed to be a vessel for about three to six months of emergency expenses if you have funds in excess of that amount, you are essentially paying money to keep it there," said Brittany Bannister, an advisor with The Financial Guys. "Inflation is a silent thief, it's just eroding away in value, look into the stock market, other assets that keep up with inflation."
Next, free up your cash flow. Shopping insurance premiums is an excellent way to increase cash flow, so is checking your tax withholdings. We often forget about this, but remember, getting that big refund from the IRS is not the best financial move.
"All that really means you are giving the government a tax free loan, so look at your withholdings and try to break even at the end of the year," Gaiser said.
Next up, make sure to have a long term plan, don't react to the ups and downs in the financial markets, and an advisor would be helpful. Take note, over 90% of all millionaires have an advisor.
"Stick to your long-term plan, you don't make major decisions based on major uncertainties, and you have that long term focus instead of reacting to the ups and downs every day," Bannister said.
Next, to keep up with inflation you need to invest consistently and diversify. Never put all your eggs in one basket, which means own more than just the company's stock you work for.
"You have to build a portfolio that is split up of different asset classes, so we can talk about debts and equities, things like stocks and bonds," Bannister said.
If you can, try investing in irreplaceable items like real estate, baseball cards, or collectibles.
"Things that aren't easily duplicated, that's gonna hold its value no matter what inflation is doing," Bannister said.
And one last thing to help you beat inflation, your health is your wealth, injury and illness are the number one cause of bankruptcy. So take care of yourself, eat right, exercise, and try to reduce the daily stresses of life.