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Fluctuating Inflation: Here are 5 Tips on Managing Your Budget and Debt

If you’re worried about the impact of inflation on your finances and family, you’re not alone. According to a Gallup poll, 41% of people in the U.S. say inflation or the high cost of living is the most important financial problem facing their family. While inflation isn’t as high as it was at its peak in June 2022, experts are saying it could stay high until 2026


If you’re feeling uncertain about your finances, here are five ways to deal with fluctuating inflation:


1. Start with what you can’t control

You may be able to budget many of your expenses, but when it comes to your mortgage or rent and auto loans, you’re stuck making those payments. Add them up and then subtract them from your monthly income. Need help budgeting? Try an app like Honeydue, Empower, or Simplifi.


2. Trim the fat

Now that we know what we can’t control let’s move on to what we can. Groceries, utilities, recreation, entertainment, driving, shopping, and eating out are all areas where you can cut back. 


3. Pay down your debt

You’ll want to make sure you’re at least making the minimum payments on your debt each month, but a better way to navigate inflation uncertainty is to actively work to pay them down. Methods like the debt snowball and the debt avalanche may be able to help you pay down your debt with more focus. 


4. Put money into savings

According to a Bankrate survey, 27% of U.S. adults have no emergency savings. If you’re one of them, now is the time to change. Try setting aside money from every paycheck, or try the 80/20 rule—put 80% of your income toward household expenses and recreation and 20% toward savings.


5. Get credit counseling

If you need more budgeting help than an app can give you, make an appointment with a credit counselor. They can help you create a budget that works for your specific situation, as well as enroll you in a debt management program if you feel unable to successfully manage your debt. This can help you reduce your interest rate, consolidate your credit cards into one monthly payment, and pay off your debt in three to five years. 


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