The pandemic changed a lot about our everyday lives. One obvious impact of the global pandemic is the supply chain issues which resulted in an unusually high rate of inflation. I'm sure you've noticed that prices have gone up. Gas, groceries, used cars, just about everything we need in our daily lives cost much more than prior to the lockdown. What's worse is that there's no telling if this is a temporary blip or if this rise in the cost of living will continue to go up. Economists are still not sure how long rising costs last but most of them agree that prices most likely won't go back down for a while (if ever).
For most of us, our wages and income probably hasn't increased to counteract the inflation spike. This means that our money has less buying power so, in essence, it's like we received a pay cut.
So what do we do?
There are a lot of videos on Youtube that discuss the recent inflation and give advice on what type of investments to make that can outpace rising costs and the falling dollar. Sure, putting your money in the right type of investments is absolutely the right thing to do but it assumes that one has disposable income readily available to make such investments.
Having disposable income is the ultimate goal because then we can make informed decisions on where to allocate our money so it works for us. A salary increase helps to create more disposable income but those only happen once or twice a year. So we need to create an artificial salary increase by reducing expenses. Take a look at your spending habits and see where you can intentionally cut back. Are paying for too many subscription services? Eating out too many times a week? Have you been doing a little too much online shopping?
Truth is that you can find additional income if you make changes to your spending behavior and reallocate that income in an intentional way.
Cutting back spending is a necessary first step when the prices of everything are rising. But that doesn't address the elephant in the room...the drastic drop in the value of a dollar. We combat this by raising our earning power. The advice I bring to you today is to reallocate the funds you've saved by cutting expenses into investing in yourself.
Investing in yourself and your potential earning power can impact your cash flow in the immediate future. If you're an entrepreneur, this means investing in ad spend, courses, seminars, or outsourcing certain activities so you can focus on income-generating actives. If you work for an organization, perhaps you pay a service to review and upgrade your resume or take online courses that further expand your skillset.
I worked in corporate America for around 7 years, during that time, I received multiple promotions and pay increases. I went from making less than $10.00/hr to earning a healthy salary complete with quarterly bonuses, a company car, and spending account. Looking back, the one thing that helped contribute to that outcome was to consistently invest in myself. Every week, I went to my local library and checked out audiobooks on various topics. I listened to books on the topics of leadership, building confidence, personal productivity, goal achievement, financial literacy, etc. When my job required me to present in front of large audiences, I invested time and money into developing a powerful stage presence (I even hired a voice coach to help me project in a large room without the help of a microphone). I was constantly learning, growing, & developing myself...and the right people noticed. Looking back, this process of self-development boosted my career path much more than my actual degree.
Investing in yourself is a move that will absolutely pay off in the future. It has to become your top priority as we head into the new year. We can't sit by feeling helpless as the price of everything goes up. You are your biggest resource and it's time to invest in that resource in a way that achieves maximum returns.
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