Consumer Sentiment Reaches Its Worst Level in a Decade: How to Cope With Rising Prices
Given the cost of living these days, it's not shocking news.
- A University of Michigan survey reveals consumer sentiment has taken a massive plunge.
- Shopping strategically, maximizing credit cards, and getting a side job could help you better manage your expenses while inflation runs rampant.
It's no secret that the cost of living has only been climbing from month to month. In January, the Consumer Price Index, which measures the cost of consumer goods, rose 7.5% from the previous year, marking the steepest increase the index has seen in almost 40 years.
Not shockingly, consumers are far from happy with the way things are. In a recent University of Michigan survey, consumer sentiment reached its lowest level in 10 years. It also dropped 8% from January.
If you're having a hard time keeping up with higher living costs, you're no doubt in good company. Here are three steps you can take to cope with higher prices.
1. Be savvy when you shop
You may be used to hitting the supermarket on a whim to buy food or running into your local big-box store for apparel. But with consumer prices being so high, now's the time to start researching your purchases before moving forward with them. That means checking out supermarket circulars (which, thankfully, you can access online) before shopping for groceries and pricing out apparel and household items at different retailers before swiping your credit card (it's best to do that research online to avoid spending money on gas driving from store to store).
2. Use the right credit cards
If you're spending more money than ever at the pump and supermarket, it's important to make sure you're being rewarded for it generously by your credit cards. If that's not the case, it may be time to fill out some applications and add a new card or two to your arsenal. There are plenty of credit cards that offer extra cash back on fill-ups and grocery purchases, so if your current cards limit you to 1% cash back, it's time to look elsewhere.
3. Give your income a boost
You may be maxing out your current paycheck right now just to make ends meet. If that's the case, boosting your income with a side hustle could give you a lot more wiggle room in your budget. It could also prevent you from landing in debt if your bills climb even more and you don't have savings. The gig economy is loaded with options, so even if you're pressed for time, you can find a side hustle that fits into your schedule. Boosting your income by even $40 or $50 a week could go a long way until consumer prices settle down.
The good news about rampant inflation is that it won't last forever, and also, it's actually a sign of a healthy economy (even though it may not seem that way). But that doesn't make the struggle any less real for you. The fact that consumer sentiment is down is a clear indication many people are struggling in the face of higher living expenses. Until things calm down in that regard, you may need to do more research before shopping, rethink your credit cards, and work a second job to get by.
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