There is no dispute, global economic inflation is here. No one can tell you how long it will affect your every day spending and expenses. Despite the great blame game, the problem is not just one thing or in the hands of just one person. However, what is certain is that ever-average person in Maryland will be feeling it one way or another for years to come.
As a Bankruptcy Attorney and debt relief agency, I often get phone calls to discuss financial issues people are struggling with in the Greenbelt area and I am asked to help find solutions within the law to those issues. As you can imagine my phone is off the hook with questions on what to do about inflation. I am going to try and outline some debt issues that you might be going through and how you should deal with them during inflation.
Inflation is affecting and creating debt problems
The biggest questions I get is what should I pay credit card debt, mortgage, student loan? Most Americans are on a fix income with either their job salary or retirement income. Employers unfortunately are part of the problem with inflation because employers are not increasing wages with the rate of their profits or inflation. The average person is forced to simply take what they are given and told not to ask for more. It is the pie effect.
A pie is only so large and has only so many pieces. So where should those pieces go too. As a debt relief agency, we always look at a person’s budget. We encourage people to look at their actual net income and expenses. What to give up in a budget? It is hard to give up anything but ask yourself what I really need to survive. Many elective expenses that are often reduced are gym memberships, cable stations, annual subscriptions and etc. These are expenses that are not necessary for everyday living and often are automatically billed out of an account and because life gets in the way you simply do not use them.
Other expenses that can we reduced is food. Food is a big item because people spend a lot of takeout or delivery. Also, a lot of people take a look at their food list and realized that they buy a lot of stuff that they cannot eat in time and end up throwing away. People take a hard look at this expense.
As a debt relief agency, we review the possible reduction on insurances, utilities, and services. We try to get people to see if they are spending too much on those items. However, all these cuts in expenses may not be enough to deal with the outstanding debt issues consumer hold.
So, the question becomes what I should pay and what should I not pay. It is an individual choice and each individual needs to decide what is most important to them to survive. Housing is a particularly important item. Without a place to live, it is hard to survive and go to work and etc. So, your money should first go to your housing. With your housing you, need heating, lights, and cooling. Utilities should be second to make a priority. And then, transportation such as your car to get you to work and back.
What is often left out is credit card debt or personal loans. As a debt relief agency, we take a look at these debts and design strategy on how to deal with them