There are a few things that you should avoid during times when prices of goods and services start to skyrocket.
Even if you’re well-off, it may benefit you to protect your wealth so that you won’t be living on dregs when the going gets tough. After all, we want to flourish and not just survive.
While there are no hard and fast rules about what not to do during inflation, here are some things that you may want to think twice about.
7 Things You Shouldn’t Do During Times Of Inflation
Do House Renovations
Unless you’re already in the thick of it, we suggest withholding any major improvements or facades to your current premises.
A leaky roof or a rotting staircase may necessitate some reconstructive work.
But other than completely unavoidable repairs, don’t go putting down hundreds of thousands on a kitchen remodel, or a living room overhaul.
Not in this economy. Not for any cosmetic, aesthetic or superficial purposes.
Renovation companies may end up charging your double for materials and double for manpower.
House renovations cost a lot.
The bigger the change, the longer it will take and them more money you will end up paying. Especially if the workers find additional, unforeseen problems in the layout of the house that will need expensive fixes and remedies.
Make Installment Purchases
Companies these days make buying their overpriced products seem much more affordable by introducing ‘installment contracts’.
This is where you essential incur debt that you will then settle gradually over the period of several months to several years instead of paying for the lump sum amount all at once.
This is, of course, the norm for many different kinds of products like furniture, vehicles and electronics (yes even certain kinds of overpriced phones).
But if you already have more than two items that you haven’t finished paying off, hold off on getting any more.
Unlike subscriptions, you can’t easily terminate installment payments.
Some companies do refund you (usually not in full), but others don’t.
And if you find that you can no longer afford to pay off the item, you’re in trouble. Especially once you’ve signed on the dotted line without reading the fine print.
Get New Subscriptions
We all have subscriptions these days, even though you may not necessarily realise it.
From your Wi-Fi bill to water purifiers or satellite TV, subscriptions are necessary and oftentimes unavoidable.
So, it’s not just your non-essentials like Netflix, Apple Music and Spotify, to name a few.
While not as dangerous as installment purchases, subscriptions can easily chip away at your expenses when you least expect. Especially if you’re on an automatic payment scheme.
Moreover, some companies resort to sneaky, unethical methods to discourage customers from terminating their subscription contracts. Such methods include cancellation fees, or termination penalties, where you actually have to pay them to leave.
Take Out Loans
Loans are important for large purchases that you can’t afford on your own. They’re only usually done for big, important things.
We’ve already talked about installment purchases, but loans are equally as dangerous.
Because they involve the cruel and nigh-omnipotent force we know as ‘The Bank’.
We may often think that people take out loans only for things like houses, cars and even businesses.
But it’s not rare for many young people nowadays to take out loans for purely personal reasons.
While some do so out of necessity and survival, others do so to maintain an expensive lifestyle that they cannot afford.
If you fall into the latter, perhaps its time to rethink your financial decision-making.
The same goes for credit cards where you don’t actually feel your money going out.
Before you know it, you’ll be drowned in debt plus interest.
Move
Moving takes a lot of money and I’m not just talking about the down payment for the new house.
Hidden expenses during relocation can come from many unexpected sources.
For instance, if your landlord finds that you’ve left irreparable damages, even small ones, to the premises, you may not end up getting your security deposit back.
Conversely, if you want to make repairs before you move out, that’s an additional cost on your end.
Not to mention, hiring movers which can incur further financial loss especially if you end up paying for ‘additional fees’.
But if you’re actually downsizing to a smaller accommodation because the rent has doubled, it may be wise to move on than stay and continue to bleed out financially for a home you can no longer afford to live in.
Start a Business
We all know that many people take out bank loans to start their own companies, and we already talked about why taking loans during inflation is a bad idea.
But even if you can afford doing so out of your own pocket, we still wouldn’t recommend doing so. Not while the costs of goods and services are at an all time high.
You don’t only have to think about input, production and manpower.
There’s also overhead costs, marketing, research, rental, licenses, legal advice, not to mention your own personal expenses: the so-called ‘growing pains’ of beginning a new venture.
It’s a bit different if you’re already established. The most you’re doing is maintaining profit, promoting, bookkeeping, etc.
Have Another Child
Finally, the last thing you should think about not-doing during inflation season, is have another child.
This, of course, is kind of a moot point if you’re already expecting and it can be unreasonable to ask you to terminate the pregnancy.
But if you’re currently trying, consider giving it a break for a few months until prices go down again and the economy stabilises.
Raising a child is expensive, especially while they’re newborns.
The cost of diapers alone is enough to put you on the brink, so think wisely about expanding your family during this time.
If you already have several children, you may already have to start cutting off expenses. So, think carefully about bringing another human being onto the planet during an economic crisis.
Inflation No-Nos
Now that you’ve read this How-(Not)-to article, we hope you can make more informed financial decisions in the future. In which case, most of this comes down to common sense.
We often don’t think about the money we spend until it’s too late.
Moreover, we cannot predict what will happen in the future. If we’ll lose our income, our job or our ability to work.
Here’s a reminder for us never to spend above our means and to always be wary of our expenses.
With these tips in mind, you’ll be able to survive these next few months without totally having to give up doing what you love. As long as it doesn’t cost too much money.
You’ve got this, parents!
Disclaimer: The information provided in this article is for informational purposes only and should not be considered as medical advice from Motherhood. For any health-related concerns, it is advisable to consult with a qualified healthcare professional or medical practitioner.
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