Saving Money During Inflation

Inflation bites.

When prices of goods and services rise, your dollars don’t stretch as far as usual. Inflation may have you staring at your budget just trying to figure out how to make the ends meet. You know you need to save money and trim the budget, but saving money during inflation is no easy trick.

If this sounds like you, you’re not alone. Here’s what you need to know about saving money during times of inflation.

Saving money during inflation isn't easy, but it's possible.
Saving money during times of inflation isn't easy, but it's possible.

Is Inflation Going to Settle Down in 2023?

Saving money is challenging enough

Nobody knows for sure. The Federal Reserve has been steadily raising interest rates in efforts to tamp down inflation, and some analysts say we’ll see a drop in the core inflation rate (the price change of goods and services not including food and energy) in 2023. 

But forecasts have been wrong before.

If inflation does come down in 2023, it probably won’t be as quickly as we would all like. Stuff’s just more expensive now! Further complicating things is the fact that this period of inflation is unique in many ways. Post-pandemic inflation is a new problem for our society to solve.

In 2022, inflationary rates hit a 40-year high. Food prices soared, with everything from pandemic-related supply chain issues to drought conditions contributing to the sticker shock. And don’t even get started on energy prices, which cause a ripple effect across the entire economy.

For small businesses and the self-employed, saving money during inflation is a vexing problem. 

How Inflation Hurts Entrepreneurs

When prices rise, it’s harder to set and stick to budgets. Small businesses may be working off of tight or fixed budgets, with limited resources and ways to reallocate their spend. 

Entrepreneurs bootstrapping their own businesses can only eat so much Ramen. 

For people employed in real estate, inflation already has had an unsettling effect on the home sales market. For people who use their cars a lot for work (like real estate agents), fuel costs quickly add up.

And with tax time looming riiiiiight around the corner, inflation may have an impact on your self-employment taxes. If you raised your rates this year to offset rising prices, did that put you into a new tax bracket? If you’re unsure, ask an accountant.

And amid all of this, entrepreneurs, solopreneurs, and other contract workers have to worry about healthcare expenses too.

Saving Money on Healthcare Helps

So how do you save money during inflation?

One major area to look for cost savings is in your healthcare. 

A lot goes into your healthcare spend each year: Monthly payments and copays quickly add up. Plus you have to factor in annual deductibles, those out-of-pocket payments for healthcare expenses that you need to make before your insurance starts to kick in.

In a recent study of marketplace premiums, average monthly premiums were $484 for individual coverage and $1,230 for families. The average annual deductible for individuals was $4,394, and for families it was $7,800. Each year the government sets a maximum out-of-pocket limit for marketplace plans—for 2023 it will be $9,100 for individuals and $18,200 for a family.

Here’s where Clearwater Benefits can help. At Clearwater Benefits, we believe that access to high-quality, affordable healthcare is a basic human right. We’re committed to helping self-employed professionals by offering innovative health plans for lower costs.

We offer both Major Medical insurance plans and Healthshare memberships. Our plans include cost-saving benefits, such as:

  • 24/7 telemedicine with a $0 copays
  • Virtual mental health coverage through Talkspace
  • $0 generic prescriptions
  • Patient programs to help with specialty medications
  • Access to national networks of care providers

Supplemental plans for dental, vision, critical illness and more are available too.

With Clearwater, you’re not tied to the Open Enrollment window. You can enroll in the Major Medical plans we sell after Dec. 31, with a 60-day waiting period. After 60 days, your plan becomes effective on the first day of the following month. So if you enroll on January 13, you’ll wait 60 days until March 13, and your plan starts on April 1.

When you enroll in a Healthshare membership you don’t have this waiting period—your plan begins on the first of the month. You can even backdate your start date as long as you enroll before the 15th of the month.

There are other ways to save money on healthcare, too. Prioritizing self-care is a big one. By being proactive with your health, you’ll reduce the chances you’ll need to see the doctor. Adopt healthy behaviors around diet, exercise, stress management and sleep. Wear sunscreen. And definitely dump those bad habits like smoking and eating junk food late at night.

Set health goals, too. Try counting your steps with a fitness tracker app, or signing up for a spinning class. Stay atop your health screenings, like mammograms and colonoscopies. 

And if you’re struggling at all, don’t shy away from therapy. It’s essential. If you need to talk, talk.

Ways Companies Can Help Employees Save Money

Companies gain a lot by helping their employees fight inflation. Going to bat for your people is a great way to grow trust and boost performances. Here are a few ways companies can support their employees during inflationary times.

Offer an employee perks platform. Perks platforms provide discounted offers on everything from cell phone plans to delivery services and home office supplies, all in one central location. Employees typically log in with their work email for closed-channel special offers. Perks drive savings and build loyalty, a win-win.

Provide a Rainy Day Fund. Like a 401K plan that you don’t have to wait until retirement to access, rainy day funds are types of savings accounts for sudden cash needs. Employers are starting to offer these to help offset unexpected expenses, incentivizing employees with matching funds or tools to help budget for savings. 

Establish Learning Budgets: Employees have spoken. They want learning and development budgets at work. By providing this benefit not only do companies boost morale, they level up the skills within their own organizations. 

Kick in for Gym Memberships. Studies show working out helps boost productivity. It’s great for mental health, too. By offering gym membership subsidies employers are investing in their greatest assets, their people.

Pay for Employee Wifi. This one’s easy. Working from home has a cost outlay for employees—so why not cover their wifi? It’s not exactly an area you’d want employees to skimp. A simple gesture that fosters good will and keeps the Zoom meetings humming pays for itself. 

How Self-Employed Workers Can Stretch Dollars Themselves

Track your expenses. How can you manage your money if you don’t know where it’s all going? It’s crucial to stay on top of your expenses. The good news is there are plenty of budgeting apps you can use to see where your funds go.

Get Cheaper Gas. With an app like Gasbuddy you can crowdsource the best fuel prices in real time. Just by inflating your tires, you can make your car more fuel efficient – whether it runs on gas or electricity.

Conduct a home energy audit. Inflation has a huge impact on your home energy costs, too. Especially during winter. Check your consumption. What temperature do you set your thermostat? Can you turn it down a bit and bundle up? How old are your lightbulbs? Any drafty windows worth a seal? Little things like this add up. 

So too do energy rebate plans. There are lots of incentives out there for new energy-efficient appliances. Take a look.

Try cash back apps and cards. Shaving off a few percentage points on standard purchases can quickly add up. Companies like Ibotta and Rakuten offer cash back on shopping for everything from clothes to electronic goods. If you’re already going to purchase something, you might as well save a bit.

Dump Dormant Subscriptions. If you haven’t streamed that channel in six months, is it worth the six bucks each month? 

Book Travel Wisely. There are high and low seasons for travel purchases, too. Download an app like Hopper for trending flash deals and advice. Sign up for Scott’s Cheap Flights for eye-popping airfares. One bonus: as the travel industry continues to rebound from the pandemic, 2023 may be a great year for cheaper airfares.

Stash Spare Change: Get a big mason jar for all your pocket change. Fill it all year, then at the end of the year, cash out. Use the change for some indulgence – a party, new iPad, a weekend away. You’ll be shocked how the quarters can add up.