Creative solutions to the rising cost of living

September 3, 2008 5:12:11 PM PDT
Are you worried and stressed out about money? Karen McCall, founder and owner of the Financial Recovery Institute, has creative solutions in these hard economic times.

Millions of people today are struggling with money issues. Consider the statistics: 70% of people in the United States do not use a spending plan or budget; savings rates are at an all-time low; about one-third of credit card holders owe more than $10,000 in credit card debt (of these, 36% have household incomes under $50,000); the percentage of disposable income used to pay debts is at a record high.

STATISTICS

  • A recent ABC News Poll found that 72% of Americans say they experience financial hardship because of gasoline prices 45% say they experience severe financial hardship
  • A recent Rutgers University Poll found that 1/3 of American workers often doesn't make ends meet every month.

    TIPS FOR SAVING

  • Clarity, know what the actual percentage increase translates to dollars and cents. Now they have a specific number to work with. This is done through tracking and reviewing records.
  • Plan and tap into creative solutions. Tips to make it work are using Cash (Cash is King) rather than debit and credit cards.
  • Spending cash makes it real - they take the blinders off and find creative solutions. The result of this careful approach will be very empowering rather than keeping people stuck and paralyzed.
  • Exchanging brand names for generic
  • Always take care of basics first.
  • Share and shop in bulk with other families or form groups to purchase directly from distributors.

    INCREASE IN EXPENSES FROM LAST YEAR:
    The Cost of Gas: $65
    The Cost of Groceries (family of 4): $102
    Total Increases: $167

  • Energy Information Administration says cost of a gallon of gas in California is up $1.16 over a year ago
  • The average vehicle uses 56 gallons of gas a month. That's an increase in monthly expenses of $64.96.
  • Groceries are up between 5% and 12%.
  • A 12% increase for a typical family of four spending $850 per month on groceries is a $102 increase in monthly expenses.
  • That's a combined increase of $167 per month for gas and groceries or $38.54 per week. This is calculating 4.3 weeks per month.

    SIMPLE COST CUTTERS
    Eliminate buying coffee 2 days/ week: $24
    Eliminate Lunch Out 2 days / week: $84
    Eliminate 1 Fast Food Dinner/ week (family of 4): $140
    Total Savings: $248

    Once a person knows how the percentage increase that they keep hearing on the news translates to the specific dollar and cents a month, then they move to the problem solving and solution stage. And this is not a "one size fits all approach."

    FOOD:

  • Bottled water-Average cost is $1. If you cut back from 14 to 7 bottles per week that's a $7 savings
  • Coffee to go- Average cost $2.85. If you buy 1 cup a day and switched to every other day that's $9.98 savings.
  • Lunch's out- If each of you eliminate one a week at an average cost of $8 that's a $16 savings
  • Fast Food Dinner out- Instead of eating a dinner out one night a week for $35 --buys a large pre-packaged dinner for $13 that's a $22 savings Combining these four simple measures could be $54.98 per week

    ENTERTAINMENT

  • Movie out for a family of 5 can be $40.00 - $50.00, renting a movie with microwave popcorn and root beer floats cost less than $10.00. Paying admission and taking your own popcorn and candy will save up to $17.00

    About Karen McCall
    Karen McCall is the founder and owner of the Financial Recovery Institute. Since 1988, McCall has counseled individuals, couples, and businesses through a holistic, transformational approach that results in a stable and secure financial foundation. The Karen McCall MoneyMinder ® system enables people to discover underlying attitudes about money-often the cause of self-defeating money behaviors such as overspending, chronic debt, under-earning, and low or no savings-while providing the tools, strategies, and support to achieve financial well-being.

    Karen McCall is recognized nationally and across many disciplines as a consultant, trainer, and speaker on effective money management and its role in overall financial and emotional stability. She has been featured in such publications as Money Magazine, Entrepreneur, and USA Weekend. She was featured on the PBS series The Financial Advisors, and was the host of the radio talk show Mental Wealth. Her published works include It's Your Money: Achieving Financial Well-being (Chronicle Books); MoneyMinder: Financial Recovery Workbook (Financial Recovery Press); and as a contributor to I Shop, Therefore I Am: Compulsive Buying and the Search for Self (Jason Aronson Press), a book for mental health professionals. Karen McCall is in demand as a presenter at conferences across the country.


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