Rising inflation is at an all-time high. From gas to groceries, rising prices are hitting consumers hard. It’s anyone’s guess when the madness will end.
Maybe you can’t get a big wage hike at work, but you can follow some of Warren Buffett’s tips on beating inflation. Your investment portfolio might not look like Buffett’s, but you can emulate some of his smart money moves.
1. Look for Ways to Increase Your Income
To offset high inflation, look for ways to bring in some additional cash into your household. This can be through picking up a side hustle, or reducing your expenses (see item #5 on spending wiser).
Ways to increase your monthly income include:
- Delivering groceries with Shipt or Instacart
- Delivering meals with UberEats, DoorDash, or Grubhub.
- Take paid online surveys on survey sites like Swagbucks, InboxDollars, or Survey Junkie.
- Teach English remotely from your home. VIPKid will connect you with a classroom and handle the lesson plans and grading for you.
- Re-sell thrift store and garage sale finds online. If you’ve got the right brand or vintage, clothing, toys, sporting gear, or furniture can do especially well.
- Test new apps and websites for developers. Check out TryMyUI or UserTesting.
- Assemble IKEA furniture. Or do whatever service you’re handy at. List your skills on TaskRabbit or Handy. Whether it’s packing boxes, scraping wallpaper, or putting together a wardrobe, there are plenty of busy people who will pay you for this service.
- Freelance writing. Pick up freelance writing gigs on sites like FlexJobs, Upwork, SolidGigs, or by reaching out to your favorite brands and companies.
- Typing. Find transcriptionist work on job board sites like Fiverr or Rev.
- Dog walk or dog-sit. If you love dogs, and other pets, you can monetize that love. Find job walking gigs on sites like Rover or Wag. Set your own rates and neighborhoods where you’re willing to work. You can also offer to board a pet in your home when the owner is out of town.
2. Invest in Good Businesses
Good businesses to invest in, according to Buffett, have low capital needs. Look for businesses with earnings high enough to cover their basic operating costs and don’t need investors to keep dumping in more money.
Similarly, Buffett says you want to invest in companies that can raise prices during inflation. The business should have the ability to raise prices without losing business to a competitor who is also forced to do the same.
3. Look Into TIPS
TIPS stands for Treasury Inflation-Protected Securities. TIPS will pay investors a fixed interest rate, twice a year, but the principal investment amount is adjusted for inflation. Inflation figures are calculated based on the Consumer Price Index.
4. Invest in Yourself
You are the best source of purchasing power. If you get a degree or a license in “old dollars” you can sell your services in “current dollars” for the rest of your life.
Pursuing advanced training and degrees can increase your market value.
Learn new skills and bulk up your resume. There are a number of free or deeply discounted online courses you can take that are enjoyable and career-enhancing.
Some online programs to check out include:
- edX: Offers free and paid courses in partnership with Harvard, MIT, Yale, IBM, and many other premium universities and businesses. Explore edX.
- Coursera: Over 5,000 courses, professional certificates, and degrees from world-class universities and businesses. Explore Coursera.
5. Spend Wiser
This means being smarter about your purchases and eliminating unnecessary purchases. Re-evaluate your “needs” and you may discover that a lot of them are “wants”.
Ways to spend wiser include:
- Tracking your money – consider using a budgeting app
- Reduce food waste (the average household throws away $1,600 worth of spoiled groceries every year) – plan your meals and stick with your menu
- Cut out unused subscriptions
- Negotiate lower monthly bills for phone, Internet, insurance, and other services. (You shop for the best deal upfront, but those rates creep up over time. Last year’s best deal is not today’s.)
- Cut out unnecessary expenses
Of course, this is often easier said than done. There are free apps and tools you can use to help you find areas where you can cut back, pain free, on spending. Some of these apps will all the negotiation work for you.
Similarly, if you have to spend money, make sure you’re getting the best possible price. Even amid inflation, you can still look for markdowns and promo codes. And you can get cash back free for your online purchases through shopping rewards sites like Swagbucks or Tada.
Earn cash back, free, for the things you’re already buying online. If you have to shell out $800 at the hardware store, make the purchase through Swagbucks. If you earned 5% cash back (and it can be more), that’s $40 free that you can use to invest in yourself.
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