While it may be unpleasant to accept, there is a general trend affecting all our financial futures: we will have to pay more for things. This can be for a wide variety of reasons that are unfortunately for the most part out of our control.
Whenever possible, keep this inevitable fact in mind when making money-related decisions. This includes when you’re planning, saving, or spending.
Consider these four examples of reasons you might have to pay more in the future, and how you can prepare for these moments:
- Take an Interest in Interest: If you are currently in debt, chances are, your borrowed funds are growing interest. This means that you will, in the end, pay more for that purchase or loan than the original amount. Research what interest rates are affecting your funds. If you have a strong credit score, consider calling your lenders to ask if you qualify for a better rate.
- As Benjamin Franklin Said: Even if we try to live in the taxpayer-friendliest state possible, eventually, we will have to pay taxes one way or another. A purchase, our income, and even gambling winnings can be subject to taxation. This can mean that we are either paying more than we may anticipate, or we will make less than we anticipate: either scenario diminishes our overall spending power. Educate yourself on the local and federal taxes you may be subject to and adjust your spending and saving accordingly.
- Prepare for Inflation: The general goal of a capitalist society is economic growth. Unfortunately for the consumer, this often translates to higher prices. If the value of the dollar rises, prices will often inflate. Counter the effect that inflation can have on your financial security by pushing yourself to save as much as possible, whether it be for your retirement fund, when inflation will be in effect, or for the emergency fund that will protect you in case of financial need.
- Greater Forces: While price inflation may be the general trend of the market, this is not a constant. Financial markets are large, with many players constantly affecting each other. For example, if one industry suddenly flounders because a resource it relies on has been wiped out by a natural disaster, this setback could have repercussions across multiple industries and affect a wide variety of prices. We never know when one change of luck for a business halfway around the globe will somehow reverberate back to our wallets. To protect yourself from this uncertainty, task yourself to save as much as possible, whenever possible.
Interested in learning more ways to prepare for your best financial future? Visit the Syncis blog at https://www.syncis.com/blog.