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How to Pivot Your Finances During Inflation

Is the skyrocketing cost of everything from food to fuel making you stress?

Don’t panic – pivot!

Inflation erodes the value of money over time, which means your purchasing power is reduced. You see the effects of inflation when you buy groceries for your family, gas up your car, or buy a big-box item like a new washer and dryer. But, with a little planning and some help from Trailhead Credit Union, you can develop a financial strategy that will have you thriving rather than floundering.

Here are some tips on how to manage your money during inflation:

Make a budget.

Budgeting – especially budgeting for inflation – is essential. You might think making a budget is complicated and time consuming, but it doesn’t have to be.  Whether you use an app, a full-featured piece of software, or simply a pencil and a piece of paper, start your budget by listing your income, and then list all your expenses. You can categorize each of your expenses such as groceries, gas, utilities, etc. Then, add up all your expenses within each category for the month. A great time to do this is before you get paid or before your government check is deposited into your account, such as at the start of the month. Ideally, you want your expenses to be less than your income, so you might need to make some adjustments. That way, you’re telling your money where to go instead of wondering where it went. Decide what goals you would like to achieve with your budget. You might want to save for vacation, pay off debt or build an emergency fund. Check out Trailhead’s financial calculators, which can help you determine how much car you can afford before you buy; how much your consumer loan payments will be before you take out a loan or pay with a credit card; and how much you should save each month to reach your goals.

Keep track of your debit and credit card expenses.

You know how it goes: it’s Saturday, and you’ve stopped by the gas station to fill up for the week. While you’re there, you get some snacks because you’re going to need some energy before you go shopping a little while later. And before wrapping up your day and finally heading home, you stop by a restaurant for some takeout. You’ve made all your day’s purchases with your debit or credit card. Without a doubt, debit and credit cards are convenient – you simply insert the card and go. But what happens if you lose track of all those receipts in your pocket – or you didn’t get the receipts in the first place? Pretty soon, your checking account and credit card spending could be out of control. Once upon a time, everyone kept track of their deposits and withdrawals in a checkbook register. If you’re still using that method, don’t stop! But another way to keep track of the activity on those convenient little pieces of plastic is to use Trailhead’s digital banking app. You can view your monthly statements and set up text or email alerts for balance levels and transactions on each of your accounts. For example, you can be notified if your checking account balance drops below a certain amount, and you can monitor all the activity on your Trailhead Visa credit card.

Diversify your investments.

Investment options like cash and bonds may lose value during inflationary periods. To reduce this risk, diversify your investment portfolio by allocating assets to inflation-resistant options such as equities, real estate and commodities.  If you have questions about diversification or you would like some help coming up with a game plan, email Jeff Brooks with City Fiduciary Group to set up a no-obligation consultation. *

Find out exactly what the credit bureaus know about you.

You can get one free credit report every year from each of the three credit bureaus – Equifax, Experian and TransUnion – by visiting annualcreditreport.com. This is the official site to get your free annual credit reports, and this right is guaranteed by Federal law. While you can get reports from all three credit bureaus at the same time, a better strategy is to request one report from a different credit bureau every three months. Check each report to make sure that the credit bureau has your correct name, address, Social Security Number, accounts, and loans. If you find inaccurate information, contact the business that issued the account or the credit reporting bureau that issued the report. While these reports won’t tell you your credit score, monitoring them is a good way to protect your identity and financial information.

Monitor inflation rates.

Keep an eye on current and historical inflation rates at usinflationcalculator.com. Also, the Consumer Price Index (CPI) measures how much you pay for consumer goods and services, and you can get those latest stats by visiting the U.S. Bureau of Labor Statistics.

Compare savings rates.

Are you getting the best deal on your savings? One or two percentage points can mean the difference between reaching your savings goals sooner rather than later. Check out Trailhead’s latest rates here.  Use this information to help you make informed decisions about your savings, such as perhaps parking your emergency fund in a Money Market Savings or Certificate Account rather than a standard savings account.

Pick up some extra work on the side.

Whether it’s mowing lawns, delivering food with UberEats or Doordash, or chauffeuring strangers around town via Uber or Lyft, taking advantage of the gig economy can equal extra cash toward your goals. Just be sure to consider the expenses associated with whatever gig you choose, such as fuel, repairs and increased wear on your vehicle.

Move it to the yard.

Have some merch you want to move? Make money by selling it on any number of online sites like Facebook Marketplace, OfferUp, and LetGo. Or breathe in some fresh air and host your very own yard sale.

Don’t let inflation burst your happiness bubble. Give Trailhead a call at 503-220-2592 or visit one of our branches to turn your inflation stress into financial strategy.


*Not NCUA Insured / No Credit Union Guarantees / May Lose Value / Not a Deposit / Not Insured by any Government Agency

Securities offered through Osaic Wealth, Inc., a Registered Broker/Dealer, Member FINRA & SIPC. Advisory services offered through Osaic Wealth, Inc. City Fiduciary Group is a separate entity from the Osaic Wealth, Inc. companies.

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