top of page

How to Gain Financial Ground & Leverage Inflation to Your Advantage

How many of you have ever made a gain financially (you get a raise, you no longer have daycare costs, you get a vehicle paid off) and you just cannot wait to have that extra cushion in your bank account? And then, the universe hits you with some unanticipated expense. It's like we put this vibe out that this additional money has opened up, and the universe is like - nope sorry, we're going to take that.

It's not coincidence, it's math.

The annual inflation rate for the last several quarters has fluctuated between 6% to 7%.

This means that if you're solely relying on your annual increase to get ahead financially, it will be incredibly hard to beat inflation.

Let me break the numbers down for you. If your raise is 5% but the average inflation rate is upwards of 6% conservatively, you're likely breaking even or even losing financial ground.

But there are ways to beat inflation however, it takes both behavioral changes as well as strategy.

The best way to beat inflation is to first understand what your means are and live below them.

What I mean by this is assessing your income and expenses to ensure that your income (money/profit you make) is higher than your expenses (the money you spend on needs, wants, and debt reduction).

Develop a Budget

One of the most profound methods to assess your means is through the development and implementation of a budget. You might think you know how much you spend, but the only way to be truly sure, is to track the data. What we think we spend and what we actually spend are two very different numbers.

Adjust Your Budget to Live Below Your Means and Generate a Surplus

If your budget tells you that you're living outside your means (spending more than you're making), make changes to live below your income. To grow wealth, you're going to need a surplus; or extra money left over.

Use the Surplus to Invest In Things That Grow Wealth In Tandem with Inflation

Once you have a surplus, in order to beat inflation, you need to invest your money in things that build wealth in tandem with inflation. Some examples of things that grow with inflation tend to include:

  • Real Estate

  • Market Investments

  • Certain Business Ventures

  • and Certain Commodifies

It is important however, to not forget about paying high interest debt, generally defined as debt higher than 8-10%. Your financial goals as well as your financial strategy will help determine the most important order of operations and allocations for which to pay down debt and invest with sometimes the actions being concurrent.

The Big Picture

You're killing it and we know you're working your a$$ off, but that work is not gaining you financial ground if you're breaking even every month and do not have a surplus.

You will continue to avoid making financial ground, unless you are able to live below your means and generate a surplus to either pay down high interest debt, save, and/or invest.

The Time Is Right To Make a Change - Work with a BTI Financial Mentor

"If you always do what you've always done, you will always get what you've always got. Choice not chance determined destiny; Henry Ford.

Financial knowledge is not taught in schools. It is not something you learn through your development unless through your parents/caregivers. The best way to grow your financial skills is to work with a financial mentor to develop money management skills and develop resources and tools that enable you to position yourself to begin to grow wealth.

A BTI financial mentor can help support you in these areas for both your personal as well as business finances.

  • Budget development

  • Budget refinement

  • Money Management

  • Customized & Data Informed Debt Reduction Strategy

  • Strategic Plan Development

  • Calculating & Tracking Network

  • And so much more

We're ready for you to build wealth. Are you?

Schedule a free 15-30 minute consult with a BTI financial mentor.

Mention this this blog and get 15% off any service should you choose to engage. BTI offers monthly support, as well as 6 and 12 month engagements with options to renew.

8 views0 comments

Recent Posts

See All
bottom of page