APPLETON (NBC 26) — As we come out of the pandemic, inflation is on the rise.
"We saw a spike in inflation in May that we haven't seen for 12 years," said Sam Duell, the founder of Duell Financial Strategies, N9654 Highway N, Suite 5, Appleton.
He says the inflation we're seeing now is being caused by increased demand after the pandemic, causing prices of things like gasoline, housing and airfare to spike.
"We're coming out of the pandemic, and a lot of industries were shut down, so they weren't manufacturing. So now we're coming into this pent up demand period and a lot of people want to buy," Duell said.
While he says inflation is often temporary, there are measures people should take to protect their finances.
"It's just taking a look at your lifestyle. Seeing what areas are you in that could be exposed to inflation so consolidating your trips, consolidating your driving and maintaining your savings account," Duell said.
Duell recommends several steps everyone can take to prepare themselves for rising inflation:
- Bringing down debt: He recommends taking a break from credit cards and starting to pay down your debt. He calls this the "debt snowball method" - you can make noticeable progress by paying as much as possible each month toward your smallest balance while still making the minimum payment on all other debts.
- Staying the course: He recommends investing or staying invested in stocks to stay on track and beat inflation.
- Having an emergency fund: He says saving enough for emergencies is one of the best ways to be prepared for inflation. Your emergency fund should have enough to cover 3-6 months of expenses if you were to lose your job, miss a paycheck or face an unexpected medical emergency.
- Setting your financial goals: One way to set your goals is imagining a long-term goal and setting short-term monthly savings goals to help get you there. He recommends saving 10-15% of each paycheck in an IRA or employer-sponsored 401(k).
