Are current economic conditions making you rethink your plans for 2022? If so, you’re not alone. According to our latest study, 60% of the people who wanted to buy a car are now reconsidering the purchase. For prospective homebuyers, that number is as high as 69%.

More than a third of Americans who wanted to get married or have a child this year are rethinking those plans too, but this bleak picture of the months ahead has a silver lining. For those who are taking control of their finances and making tough choices, their financial future is much more likely to remain secure.

Keeping your finances on track during economic uncertainty

Just ask Paul Gipson. He’s been through it before. When the aerospace industry plummeted after 9/11, the company he worked for made 15% pay cuts across the board and lowered its 401k matching program. Gipson used Quicken to see where his family could cut back and where they couldn’t, adjusting their budget to protect their retirement plan.

Today, he and his wife are enjoying a comfortable retirement. By tightening their belts and planning ahead, they were able to weather the storm, and so can you. Here are 8 tips to help you take control of your finances, fight inflation, and come out ahead.

Top 8 ways to fight inflation and protect your finances

1. Understand your budget

First, break your spending into categories so you can see where your money is going. Then, pay attention to your spending in each category.

With inflation impacting everything from food to travel prices, you may see some of your categories increase over time even if it doesn’t feel like you’ve been buying ‘more.’ This can help signal where you need to make changes to your habits and spending patterns, so you don’t feel strapped for cash.

2. Save your bonus

When you get a bonus from your employer, you may feel inclined to spend it to reward your hard work. Before the money comes in, consider your finances as a whole and decide how much of that money you need to save.

Setting aside most of those funds in an investment account, retirement account, or savings account might be more rewarding in the long run.

3. Set specific goals

In times of economic uncertainty, it’s important to keep setting financial goals. Nearly half of our respondents (47%) were able to build an emergency fund over the last two years with money they saved by delaying large purchases.

Maybe it’s not the best time to purchase a new car or home, and that’s okay. Even with inflation eating into our monthly budgets, we can still make choices that protect and build our savings.

4. Clear away debts

Make a list of all your debts and pay the most expensive ones off first. For example, prioritize those that have the highest interest rates or that may prevent you from achieving other financial goals. After paying off each debt, move on to the next until you’ve cleared them all away.

As you prioritize your most expensive debt, keep paying the minimum amount owed across all your debts to avoid late payments and protect your credit score.

5. Make lifestyle changes

If you’re dreading the idea of making changes to your lifestyle, try to look at the process in a new light—as an opportunity to reassess what’s most important to you.

The majority of our respondents said that they’ve cut back on driving (66%) and eating out (63%) to combat inflation. Consider using these kinds of changes as an opportunity to spend more time with family, preparing meals and eating together.

If that doesn’t fit your situation, look for different places to save. Remember, you don’t have to cut back on everything. Choose your priorities to protect the spending that brings you the most joy—for today and tomorrow.

6. Set up autosave

One of the best ways to keep growing your savings is by putting a set percentage of each paycheck aside. Instead of waiting until the end of the month, set up a recurring automatic transfer from your checking to your savings account just a few days after your paycheck hits.

By starting with small amounts, like $20 or $50, you can pave a pain-free road to a comfortable emergency fund. You’ll be surprised how quickly your savings will add up!

7. Take stock of subscriptions and bills

Start by coming through your list of subscriptions to see what you can live without and where you can cut back.

  • Are there subscriptions you don’t use anymore?
  • Could you group some with other family members for a cheaper family plan?
  • Would paying annually instead of monthly save you money?

Then, for recurring bills like insurance or cable TV, explore your alternatives. Maybe your needs have changed and you could benefit by downgrading plans, or maybe you could find a better price by shopping around.

Before you start making tough choices and giving up things you enjoy, take a closer look. You might be able to save money without giving up anything that matters to you.

8. Take a staycation

During hard economic times, people often cut back on vacations and discretionary spending. Of our respondents, over half (52%) cut back on travel.

Still, it’s important to practice self-care, take breaks from work, and recharge. Instead of that trip to Disney, consider a more affordable staycation or smaller expenses (like getting your nails done, going on a day trip, or going to the movies) to unwind instead of giving up on fun activities entirely.

Final thoughts

During hard economic times, it’s important to make financial choices that continue to serve your goals in the long run. While it isn’t fun reassessing and adjusting your lifestyle choices, it’s important to keep making financial decisions that can help you protect your financial future.