Overcoming Cost of Living Challenges

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Saving money is hard. It’s a reality most Americans have to contend with. In a perfect world, we’d all love to have a nice nest egg in case we need it. The problem is, the cost of living is way too high! It’s so high, that more than half of us don’t even have $1,000 in savings.

When asked, 36% of Americans claim their biggest regret in 2017 was not saving money, and they blame the high cost of living as the number one reason why. 20% blame their low salary as the reason why they don’t save. 15% don’t even budget, essentially throwing their financials together with duct tape and sawdust.

Everything Changes Except Salaries

The biggest culprit behind people not being able to save is how much things change from year to year. With every turn of the calendar year, it would seem as if prices continue to rise. The cost of rent goes up. The cost of food goes up. Gas prices fluctuate, but most often, go up. Insurance rates go up. Interest rates go up. Taxes go up.

 

While all these aspects of everyday living continue to grow more expensive, our salaries stay the same. If you’re lucky, you might get a $.50 raise, but that doesn’t go far compared to the other bills that keep stacking on top of each other. It’s no wonder more Americans are finding themselves struggling with debt.

Despite the Struggle, Saving is Key

No matter what our circumstances might be, we cannot afford NOT to save money. It’s crucial, essential, and may even be lifesaving! How would you be able to afford a major crisis happening? Most of us go through life as if nothing bad can touch us, so we don’t even worry about it.

Maybe we can get through until our golden years relatively untouched, but what happens then? We lived at or above our means for so long, did you have time to plan and save for retirement? This is one part of life that just has a way of creeping up on us. Americans are now working longer than they ever used to before due to the lack of financial planning.

You Must Become Debt Free

As difficult as it might sound, the only salvation for rising costs is to get out of debt, especially if you don’t anticipate your salary rising. Americans get caught in the trap of turning to credit cards and getting loans when they want something they can’t afford. But that’s the thing! They try to pay for things they can’t afford and it costs them in the long run.

Just assuming you’ll get things on track before retirement isn’t going to cut it. You need real change and to get ahead of the snowball running downhill. It will only grow larger and larger until you can no longer manage it. Having an emergency nest egg, saving for retirement, and ensuring you can live comfortably below your means is MUCH more important than buying that brand-new car or doing anything that incurs new debt.

If you’re burdened with lots of debt, the best course of action might be to consider debt consolidation. That will allow you to put all your loans and debts into one neat package to make the repayment process simpler, saving you money verses not getting a consolidation.

You can also try to do a debt settlement, which may even lower the amount you owe and can save you thousands of dollars. Whichever you choose, getting out of debt (and not adding on more) is the best way to improve your financial situation.

The best rule of thumb is to not pay for anything you can’t afford. If you’re in a dead-end job and you don’t see your salary going up anytime soon, there’s no reason to make your circumstances more difficult than you need to.

Make new goals and be smart with your finances. Then, you can celebrate being one of the few Americans who are debt-free and without the worry of having nothing to fall back on in case the worst were to happen.

 

Last modified: February 12, 2018