Calling all Cost of Living experts! Time to share your 50-plus years of wisdom
You might have missed it, but Tuesday March 15 was World Consumer Rights Day marked by a campaign for Fair Digital Finance.
As raised in this blog two weeks ago, it's a pressing issue, but really the only consumer issue in town for weeks and maybe now years will be the cost of living.
As we've all noticed, many items are rising in price. Some like petrol have gone up steeply and suddenly. Others are just not so available, such as cars and building materials.
And worse of all, some have exhibited both price and supply difficulties such as housing and coming soon to a flood-prone street near you … home insurance.
So what are you going to do? Wait for the government to do something or take those matters you can into your own hands?
The forthcoming election will see much pontificating about just what governments can't do to put 'downward pressure on prices' (I hate that miserable phrase as it hardly ever delivers!)
Sure they can cut taxes and charges, but it's a bit of a cheat as they have to get the money from somewhere, and post-COVID, we are seriously in debt.
Next week we'll ask you, and look into, what, if anything, the authorities can actually do to reduce prices but today, inquire into what individuals can achieve.
For example, the individualistic makeup of 'my cost of living' might differ from generalised 'the cost of living' indexes. I might not have a car. I might be a teetotaller or even a vegan.
So what do you do to reduce your cost of living? There are many so-called hacks out there that marginally chip away at many bills with the promise of delivering aggregated savings worth getting out of bed for.
Switching to cheaper contracted electricity providers, insurances and telecomms all add up, as does 'shopping around' for smaller but more frequent savings on petrol, groceries, clothing etc.
There are other strategies too. For example:
- Have less. Consumerism drives us to buy more but do we need it? It is possible to reduce, but you'll have to battle the pervasive online advertising and frictionless payment systems, which do not require the literal pain of opening your wallet.
- Substitute. You can eat less lamb and more legumes. Yeast comes cheap, and you could even make - and it's not so hard - your own bread and beer. You can drive less and save on the petrol bill by where possible using the train or bus more.
- Downgrade. This might be the least comfortable tactic as once we've developed a taste for the finer things in life, be they cars, $800 shoes or fancy wines, it can be hard to go back. But don't be a one-way victim of the wealth effect whereby people tend to spend more often on luxury goods as incomes increase. As for nearly all of us, rising prices are outpacing wage growth, and some selective downgrading done gently might not be so hard. For instance, blind taste tests prove that even wine connoisseurs often can't distinguish between solid plonk and the priciest pinot noirs.
- Don't sweat the small stuff. It's argued most of our spending, and hence our savings is in the handful of big purchases and lifestyle choices we make: dwellings, cars, where we live, who we marry. Some of these are easier to change than others.
The over-50s are experts in this area by virtue of our hard-win experience over more than half a century.
So it’s time to share what you know: what, if any, are your plans to make savings for what might be a prolonged period of higher prices? Or will you just get used to petrol at more than $2 a litre and just pay?
Any information contained in this communication is general advice, it does not take into account your individual circumstances, objectives, financial situation or needs.
