Leaving a meaningful legacy for your heirs and beneficiaries takes planning. Inheritances are generally a direct result of a lifetime of savings and careful spending. But if you have been to the store lately or started the process of making a big purchase, you have probably noticed a sharp increase in prices.
It appears our post-pandemic world has launched us directly into an inflationary period. Last month, the U.S. Bureau of Labor Statistics reported that the Consumer Price Index rose to 7.9% over the preceding 12-month period, a 40-year high!
So, what can we do? First, don’t push the panic button because once inflation sets in, prices will only rise; instead, consider your options. Inflation really means less purchasing power. Therefore, if you have an opportunity to increase your income and thus increase your purchasing power, start there. If not, or making that kind of change will take time, consider ways you can maximize your existing spending power. Below are a few easy money-saving tips we have compiled to jump start your savings journey.
1. Shop With a List
Show of hands: How many times have you walked into the grocery store with the goal of purchasing just a few necessary items, but then walk out with so many shopping bags that it takes you multiple trips from the car to get everything in the house?
It happens more often than people realize, but if you take a couple of minutes to survey your pantry and refrigerator and write down only the things you need, you will spend a lot less. Once at the store, focusing on the list will help you avoid aimlessly drifting through the store and adding extra things into your cart.
2. Shop In-person
During the pandemic, we became accustomed to shopping online and having everything from food to toilet paper delivered straight to our doorstep. Between the app’s convenience fees, delivery fees, and driver tips, you could end up spending 20 to 40% more than the actual cost of the goods! Now, in a post-vaccine world we can, and should, re-examine our spending habits. Simply changing one old habit such as picking up take out food instead of having it delivered, will yield easy savings.
Additionally, there are hidden savings to be obtained while shopping in-person. For starters, you can find good deals shopping the bargain bins. Second, there are no cookies! And I’m not talking the kind you eat, but the digital ones websites tag you with each time you shop a retail store online. Ever notice how prices tend to fluctuate more online, especially after you have visited the retail vendor’s website once? Cookies! And not even clearing “cookies” is enough these days. Now you have to search “incognito”–a real hassle if you aren’t good with remembering your logins and passwords to your favorite websites.
Recently, while shopping new computer monitors, I found a great bargain buying floor inventory at a big box store. It was a way better deal than what was idling in my Amazon cart. And I went to this particular store knowing that it had an online price-matching policy. Finally, at checkout, they offered me a 6-month interest-free store card for all purchases of $499 or more. When the rate of inflation is 7.9% a year on consumer goods, an offer like that means they are willing to pay you to unload their inventory. Say it with me: In-person shopping FTW in 2022!
3. Use Cash for Daily Expenses
Cash apps and cashless services like Paypal, Venmo, Zelle, and the like are ubiquitous these days. But these vendors make the act of spending just a little too easy. The intangibility of using an app to pay for something makes us less mindful of what we are spending our money on.
Instead, consider making a realistic budget for all your spending, including the little things you normally pay for with these apps such as personal services, dinner outings with friends, or collective gifts for our kids’ teachers or colleagues at work. Create a daily budget and carry only so much cash as you need for that day. Using cash will make you re-consider each expense. And once the cash is spent, you will have certainty that you cannot afford the next request.
To implement this money-saving tip effectively, you may need to delete these apps and services from your personal devices. For some, this may be easier said than done, but is definitely one habit you can change that is worth every penny!
4. Skip the Coffee Shop
You’ve probably heard this one before, but this easy money-saving tip really works. If you are stopping by your local coffee shop every morning to get your caffeine boost, chances are you are spending at least $5 every time. Simple math will tell you that doing this five times a week will cost you around $100 a month, and that’s not including weekends or afternoon coffee runs.
Instead, if you buy yourself a nice travel mug and brew your coffee at home every morning, it will cost you about 25 cents per cup and save you over a thousand dollars a year.
Instead of buying new, consider an “upcycle” project instead. When I first moved into my home 10 years ago, my dad gave me a solid blonde oak desk he had bought for his office back in the mid 90s. It arrived fairly beat up from years of him kicking up his feet on it and spilling his morning coffee, but it was otherwise usable with a generous worktop. At the beginning of pandemic, my husband and I repainted the desk and installed drawer pulls on it and voilá, it was like brand new (and fit for a modern lawyer’s home office)!
If you don’t have something in your home you can upcycle, consider shopping online garage sales. The search for the right item and actually working on the “upcycle project” can become a fun and engaging experience the whole family can enjoy.
Save on “Things”, Not Experiences
Finally, notice that these easy money saving tips concern the “things”. In a post-pandemic world, however, I cannot advocate for limiting our life experiences.
For nearly two years, many of us lost the ability to connect with one another in meaningful ways. Although we should be careful and thoughtful about our spending during an inflationary period, that means we may need to prioritize and shift spending habits as it concerns consumer goods. But spending money on experiences or services that enrich or better our lives or those we love, is priceless!
If you have questions about how to create a meaningful financial legacy for your family, contact Law Office of Adriane S. Grace for an initial estate planning meeting. We can discuss how to safeguard your savings while bettering the lives of those you love!