Regular unleaded gasoline was $4.69 per gallon (cash) at a Houston Exxon Mobil station on June 9, 2022. Gasoline prices are hitting record highs as demand rises and supply fails to follow.
Brandon Bell | Getty Images News | Getty Images
Americans are still grappling with the worst inflation in about 40 years, and many are changing their spending habits to keep up.
In May, prices were 8.6% higher than they were a year ago, according to the Consumer Price Index report from the US Bureau of Labor Statistics. Some of the biggest drivers were rising costs associated with food, housing and energy.
As a result of these price hikes, 61% of Americans say they are worried about their financial situation, according to a survey of more than 1,000 adults conducted by Toluna from March 23-29.
Many Americans now expect to have to spend more on a range of purchases, from personal care and home improvements to experiences such as vacations.
“As with any time you have a change in circumstances, such as a job change or considering buying a house, now is a great time to review your spending for the past three to six months,” Roger said. Ma, Certified Financial Planner, founder of New York-based Lifelaidout, and author of the book “Work Your Money, Not Your Life: How to Balance Your Career and Personal Finances to Get What You Want.”
How to set
Doing such an audit of your recent spending can help you make sure you know where your money is going and recalibrate if it’s being diverted from your financial goals.
Because inflation drives prices up so quickly, Ma suggests checking your spending and revising your budget frequently.
“Plan it a few months at a time,” he said.
Also, since inflation is so pervasive, people may need to get creative in finding ways to cut their budgets. Ma noted that he’s seen customers cancel some subscriptions, as well as change their shopping lists — from buying more generic items instead of branded ones, to swapping more expensive steak for cheaper chicken, or even to the complete abandonment of meat.
Customers say “I was getting this fancy milk, but I’m okay with the grocery store brand milk,” he said. “People are totally making these kinds of decisions to fit into their budget.”
The good news is that many consumers are already making the spending changes they need to adjust to rising prices.
More than half of Americans said they were willing to try new brands of food and beverages, cleaning products and personal care products to cut costs, and about a quarter have already switched, according to the Toluna survey.
Bring extra money
At the same time, if you’re having trouble cutting costs, now is also a good time to see if you could potentially make more money, Ma said.
This means considering changing jobs in the hot market or starting a side hustle that could bring in some extra cash to help balance your expenses.