Three Steps You can Take to Mitigate Inflation

Inflation Hits Food, Water, and Shelter

Inflation leaves the wallet empty
Inflation leaves the wallet empty and the credit cards over loaded.

I just paid $2.79 for a food item that used to cost $1.29. That’s a 116 percent increase since 2021. But because gas prices have been dropping, we are supposed to be convinced that inflation is “under control.”

If we know anything, it’s that gasoline and other energy prices are volatile, prone to jump and then drop, but most items just keep climbing. So while I will enjoy buying gas around the $3 mark, I don’t expect it to last.

Remember the $5 foot long Subway promotion? It ran from 2008 through 2016. For eight years, inflation was low enough that subway could sell you any one of six foot-long sandwiches for $5. I went to Subway earlier this week, and the least expensive six-inch sub was $5.99. That means I had to spend 20 percent more to get half the food I used to get. That is an example of how inflation hits us in our wallet and our dinner table at the same time.

Government Lies

Remember, when the government or a talking head says “inflation is dropping,” what they mean is that the reported rate of inflation is moderating. They don’t mean prices will drop. Your grocery bill will not return to pre-COVID prices, and neither will the cost of a car or a new pair of my favorite Danner boots. Prices will continue to rise, just more slowly.

Plus, the way they track inflation has changed since the 1980s; as a result, inflation is under-reported. True inflation is eight or ten points higher than government says. Inflation remains high and costs keep climbing. Your bank balance knows it, and you sense it when you pay a bill, but the government won’t admit it.

The Big Three

Just as food, water, and shelter are important for prepping, they are critical in our everyday life. Costs for all three have increased significantly, which is why Americans feel so much financial pain, even if they aren’t feeling it at the pump.

  • The average mortgage payment on a new home is $3,322, up 90 percent, or almost $1,600, since Biden took office.
  • The average electric bill has increased 38 percent since 2019. Some of this increase is because energy is more expensive, but a good portion of the increase is also due to the cost of green energy and the loss of low-cost coal generation.
  • The average water bill has increased 51 percent in the past decade.

How to Combat Inflation

You can’t stop inflation, but here are three things you can do to fight its effects:

First, try to live as frugally as possible. This takes some getting used to, but if you put your heart into it, you can cut your expenses. There are many ways to do this, and they range from simple (cut the number of streaming services you use or get a cheaper cell phone plan) to ones that require you to change your life. The latter include less eating out, more cooking from scratch, shopping only at thrift stores, and buying only what you must have to survive, not what you want. It could entail moving into a smaller home, driving a cheap used car, and perhaps dumpster diving and salvaging things others have discarded. There are books, blogs and YouTube channels dedicated to living frugally that can help you adapt this approach.

Second, make more money. This is almost the opposite of the above suggestion, but if you can make more money and be more frugal, you can not only beat inflation, you can save and set yourself up for success. Making more money might mean working more hours, having a second job or getting paid overtime at your current position, having a side gig, doing odd jobs on your off hours, or having a hobby that occasionally produces an income, such as gold prospecting or metal detecting.

Third, become more self-sufficient and produce more of what you need so you spend less buying it. This can mean things like growing your own food or sewing your own clothes. It might mean canning your own peas, corn and beans or making your own soap and laundry detergent. Even chopping your own firewood to heat your house can save you hundreds or thousands.

You Must Get Ahead of Inflation

The key to surviving inflation is to get ahead of it. You don’t want to look for work in the middle of stagflation or decide to downsize only when you can no longer afford your rent. It’s best to have a low rent before inflation hits. You also want to know how to cook inexpensive meals and break the fast-food habit before rising costs force you to do so.

Starting a business or a side gig is also something best done while you can still afford to fail. Building the skills and your reputation for sewing, carpentry, or as a shade tree mechanic is also important. At some point, inflation may be render the dollar so useless barter will make more sense than paying someone in worthless paper with dead presidents on it. If your reputation proceeds you, you will have more people willing to trade with you.

I have done many of these things to allow me to spend more on preparedness: I’ve had side gigs, run eBay sales out of my basement, and taught shooting lessons to make money. I’ve driven old cars and shopped at thrift stores. There was a point when my youngest daughter had been to more restaurants in our hometown than I had because two of her close friends never seemed to eat at home while we rarely ate out. One of the families was well off; the other was barely making ends meet. I don’t know why they spent money eating out when they could have reduced their burden by cooking at home. Maybe that was the way they were raised, or they never learned to cook. Whatever the reason, I think it was the wrong call. I dare say we are better off today as a result of eating in.

The Mental Adjustment

The biggest challenge in adapting to rapidly rising costs is the mental adjustment you have to make. You must admit to yourself that your current lifestyle cannot keep up with the rising dollar, which to some will be akin to admitting defeat. You will have to abandon the consumerism that defines Americans and dig deep in our cultural history to channel that cheapskate who learned how to pinch a penny and make stone soup back in the Great Depression.

Taking small steps today can prevent you from having to take big steps tomorrow. And by big steps, look at Argentina where they have 143 percent inflation just devalued their peso by 50 percent. Look at Venezuela, where ballet dancers became prostitutes to support their children. Big steps also might mean resorting to shoplifting, burglary, or kidnapping to raise money.

You can adapt, but taking small steps now is better than waiting until your back is against the wall, your credit cards are tapped out, and the bill collectors fill up your voicemail. The cost of living is rising at a rate far higher than the government reports. You can either run faster on their treadmill or opt to take a different path. It’s your call, but don’t ignore the writing on the wall.