News

Actions

Preparing your finances as the country hits highest inflation in four decades

Posted at 8:27 AM, Jun 24, 2022
and last updated 2022-06-24 09:27:48-04

NASHVILLE, Tenn. (WTVF) — With the highest inflation in 40 years, our finances are feeling tighter. Experts say it's no time to panic, but time to be prepared.

The author of "Crawl Before You Ball" Buffie Purselle writes about our emotional ties to money and why it's so easy to rack up debt, which is a killer with higher interest rates.

So what is it about spending or getting things that seem to make us happy...at least temporarily?

Purselle says when you make a purchase you often get that "feel good" burst.

"It's like a drug, it's akin to being addicted to alcohol or being addicted to some sort of illicit drug. You get an immediate high," she said. "Coming out of the pandemic, a lot of us are depressed and sad and we're chasing happy."

Purselle said it's so tempting to charge, but with a looming recession possible, she says people need to stop spending on wants and focus on needs now.

It's important to meet as a family and develop a plan first, Purselle says.

"Everyone needs to know these are the things that we have to work on," she said.

That may be less meals out, or postponing that vacation until you can pay for it.

She expained that it's important to have short term and long term goals. If you have a big goal, like wanting to save $50,000, "it seems like you will never attain it."

So, Purselle says, it's good to attack one credit card, maybe your high interest credit card and get it paid off, then "you feel happy when you achieve that goal."

Probably no surprise, but Purselle insists coffee stop lattes and eating out are budget breakers.

"Death by a thousand cuts," she said, explaining that it doesn't mean you can't get some things you want. "Set some allowances for yourself...fun money."

If you can, make a point to pay off your credit card each month, and if you can't, it's likely time to stick to cash so you can stick to your budget.

"You'd be surprised how much you save," she said.