Ask Chuck: Are You Exhausted By Inflation?

Dear Chuck,

I am exhausted trying to make it to the end of the month while remaining within my budget. I feel like inflation is robbing me of more than my money. I am losing my joy every day that this continues. 

Exhausted by Inflation
 

Dear Exhausted by Inflation, 

I wish I could tell you that it will soon be over, but since no man knows the future, I steer clear of trying to predict it. We can only look at the facts and adapt to the reality of our circumstances today. My hope is that this reply will help bring back your joy. 

Inflation with Risk of Recession

We are experiencing both inflationary times and a risk of contraction of economic activity. This can cause great fear and uncertainty. Consumer confidence is shaken when unemployment rises, businesses close, and the stock market grows increasingly volatile. 

Putting the Brakes on Inflation 

On Wednesday, November 2nd, the Fed raised interest rates another .75 percentage points, pushing borrowing costs to the highest level since the Great Recession. More could lie ahead. Could the effort to bring down the cost of living plunge us into a recession? Maybe. The bright side is that savers will benefit from higher rates on their accounts. It is a difficult balance to curb inflation without tipping into a recession, but this is a clear sign that our government wants to contain inflation. Maybe the end is in sight. 

Making It to the End of the Month

A Forbes survey of consumers reports that current economic conditions have caused 38% to dine out less, 36% to adjust their budgets, 33% to reduce the miles they drive, and 32% to purchase cheaper or different items than usual. In addition, 23% of Gen-Z consumers plan to take on another job. 

If you spend less than you earn, you need not fear a recession or prolonged inflation. How is it possible to spend less than you earn? You either have to earn more money or cut expenses. Pray for wisdom to make wise decisions. Like the Apostle Paul, we can learn to be content in any circumstance, even in the midst of sacrificing comfort. 

“Whoever works his land will have plenty of bread, but he who follows worthless pursuits will have plenty of poverty. A faithful man will abound with blessings, but whoever hastens to be rich will not go unpunished.” (Proverbs 28:19–20 ESV)

The Harvard Business Review offers the following tips:

  • Finding a second source of income will keep you extra prepared. Whether a part-time job, a side hustle, or selling used items like books, clothes, jewelry, etc., creating additional revenue will give you a cushion in case there is a reduction or loss of primary income.
  • Remember that investing is a long-term financial play. Don’t get discouraged by short-term movements in the market. Dollar-cost averaging, or investing progressively in the stock market, is a valuable move during challenging economic times.
  • Diversify, and remember that the stock market and real estate assets increase in value over time.
  • Tax-advantaged accounts and tax deductions will reduce your overall liability.

Budget Wisely

  • Evaluate your budget every month, and highlight items you can cut if necessary.
  • Track your spending, and make adjustments quickly.
  • Meet with your spouse and/or mentor regularly to discuss your finances.
  • Cut unnecessary spending, and use cash for variable expenses.
  • Set aside funds for upcoming needs, and delay large purchases.
  • Avoid increasing fixed expenses.
  • Find ways to cut major expenses.  
  • Do not invest money that you might need soon.
  • Continue giving while building an emergency fund.
    • Aim first for $1,000 and then for a minimum of 3–6 months of basic overhead costs.
    • Set up automatic transfers, and deposit extra cash at the end of each pay period.

Reduce Debt and/or Increase Income

  • Pay off credit card balances and any payday loans.
  • Negotiate lower rates with card issuers.
  • Set up snowball or avalanche methods. 
  • Do not co-sign notes, and avoid any new debt.
  • Consider a 0% balance transfer if you meet the restrictions.

Stay Employable

  • Don’t take your job for granted.
  • Work as unto the Lord with a grateful heart.
  • Learn new skills, and embrace new technology.
  • Be flexible, and willingly take on new assignments.
  • Be a peacemaker, encourage others, and do not gossip. 
  • Honor your superiors, and treat everyone with respect.
  • Read widely and study advances in your career field.
  • Have a backup plan, and update your resume regularly.

Rejoice Today 

We only have today, so regardless of our circumstances or what may be looming in the future, we should find reasons to rejoice. Every morning that I wake up, I say this verse in my head or sometimes aloud: “This is the day that the Lord has made; let us rejoice and be glad in it.” (Psalm 118:24 ESV). I then go about doing my duty as faithfully as I can, knowing that He will get me through every storm. I hope your joy returns today.

If credit card debt is adding extra stress during these uncertain economic times, consider contacting Christian Credit Counselors. They are a trusted source of help toward financial freedom. 


This article was originally published on The Christian Post on November 11, 2022.