When inflation is soaring high, with countries like Germany and Belgium hitting 10%+ and Estonia or Lithuania 20%+, it can eat up savings and leftover cash flow pretty rapidly. In the worst case, this could lead to you needing to take up a loan, to be able to pay for your everyday life.
Don’t fret, though, as in this article we’ll show you 5 ways how to save money during times of high inflation. Hopefully, some of these will help you to reduce your monthly bill and increase the cash flow without necessarily feeling like you have to abstain. Let’s go!
Saving on energy bills
Not every area of spending is affected by inflation in the same way. At the forefront of rising prices is energy, which is denoted by the European Statistical Office (Eurostat) to be at 40.8% in September. So if you find ways to save on energy bills, it can have a huge impact on your bottom line.
A simple way to do that, without needing to cut back on any consumption, is plugging out unused appliances. It’s an age-old thing everybody has been talking about for years, but it’s actually highly effective.
Max from the Lendermarket team recently measured the power consumption of devices in his home and found out that just leaving the TV plugged in on standby, would cost 91 EUR per year, if you pay 0,40 EUR per kWh. That’s because the TV in standby still pulled 26 W, which is 624 W per day, or 227,76 kW per year.
Also, changing lightbulbs to use LEDs instead of the classic ones, can reduce the power consumption drastically. If you have a lightbulb that currently uses 60 W and is on for an average of 4 hours per day, that’s 1460 hours. With a price of 0,40 EUR per kWh, that would be 35 EUR. Switch that out for an LED with 6 Watt, and you pay only 3,50 per year, and that’s only for one light in your house.
Save on food and home maintenance supplies
This one uses another ancient technique: You know how your grandma always used to go through the supermarket brochures to find the best deal of a certain item? Well, that is actually a smart thing to do.
Sure, nowadays, we don’t have time to read through 5 different brochures every week just to save 10 Cents. But there are websites that digitalize all these brochures and let you search for specific products. Couple this with bulk shopping, and you can easily save 50 – 100 EUR a month without much extra work.
For example, if you always buy a specific brand of coffee, then use one of these websites to set an alarm to notify you when there is an offer. If you normally drink one package a month at 11 EUR, and now you buy it at 7 EUR, you save 4 EUR, which over the course of a year is another 50 EUR saved.
This works especially well with items that have a long shelf life, such as home supplies. In the current environment where prices steadily rise, you can buy your items for the cheaper price, and save once more because it likely stands to be more expensive in the near future anyway. So, even if you don’t hit the lowest prices, you’ll still walk out a winner.
Save on services
Saving on services is tricky without feeling like you abstain from something. With high inflation also companies and service providers match their prices to fit the economic situation. A way to save on services, let’s say a maid that cleans your apartment, you could ask yourself if there’s some kind of technology that could help you.
Not necessarily a vacuuming robot, but what if you bought yourself a contact grill that prepares your meat almost by itself, and you cut some veggies and throw them in a pan. While your meal almost comes together by itself, you could use the freed up 20 minutes to spend half of it cleaning your apartment.
In the end, you get your food faster, save time and money on needing to hire a maid. Sure, it might not be the obvious solution to your case, but there’s always multiple ways to tackle things. Maybe you can find a way to creatively replace one of the services you use?
Earn-inflation beating interest rates from investing
High inflation is often accompanied by not so happy stock markets. Time calls the current year the stock market’s worst year in more than a decade, and it can be difficult to invest money where you get 10%+.
A few weeks ago, we asked P2P experts to share their valuable tips to beat inflation. One thing that stood out was that P2P was in their eyes suited to get higher returns than the inflation rate.
At Lendermarket, we currently offer an average return rate of 14.1% per year, which could be a way to still invest profitably during this economic situation. With a buyback guarantee and Auto Invest feature, the investing is as easy as never, and you can start with just 10 EUR.
Increase your income
One thing that can’t be missing in this list is: increase your income. If you want to have more money left over at the end of the month, then this is a suitable path to take. It doesn’t necessarily mean you need to work more or pick up a second job.
An option that’s open for most employees is asking for a raise. Outline why you deserve a higher salary (you take over more responsibility, help your boss earn more money etc.) and you have done a good chunk of preparation to get you closer to that raise.
This article just presented a handful of options to save money, but if done right, it can help you save 1000s of EUR every year without much effort. Most notably, paying attention to how your power and electricity is used throughout the apartment has a big impact. For more ideas, you can take a look at our article on how to protect against inflation.
Also, we’re currently running our beat inflation campaign, where we visually show you how you can get the better of the rising prices and make the most out of your money. Feel free to check that out!