How Are YOU Successfully Beating Inflation?

[Cranky]

I dunno. There is a ton of apartment construction in my Fair City and its environs. And yet, nice apartments are expensive, and nice houses on big lots sell like hotcakes.

My house has doubled in value in 7 years.

The house across the street sold the first weekend it was on the market, for $80k over asking.

It doesn't really seem like there's not enough housing to go around.

Seriously, doubled in value ? Did you do a lot of improvements? Sometimes home owners do not account  for their expenses when making such claims.  I've heard of markets with great home price appreciation but have not heard of anything like this. What part of the country are you in?

I’m in Wisconsin.

This house sold for $250k in 2015, for $380 in 2020, and the zestimate is $500 now, and I can well believe it because other houses on our street have been snapped up in that range and frankly, ours is bigger and has a bigger yard, like .5 acre size.

We haven’t really done much yet. The furnace and a/c were replaced as part of our purchase and we’re on the list for windows. It either needs to be painted or we need new siding.

But it’s a very very pretty neighborhood in a city with rapid growth.

[lutorm]

We work to become FI so we don't have to worry about inflation any more than we worry about market downturns or whatever. I remain secure in my belief that we're not anywhere near economic situations that would make our FIRE calculations invalid, so I'm just not going to worry about it and live my life.

[bryan995]

I dunno. There is a ton of apartment construction in my Fair City and its environs. And yet, nice apartments are expensive, and nice houses on big lots sell like hotcakes.

My house has doubled in value in 7 years.

The house across the street sold the first weekend it was on the market, for $80k over asking.

It doesn't really seem like there's not enough housing to go around.

Seriously, doubled in value ? Did you do a lot of improvements? Sometimes home owners do not account  for their expenses when making such claims.  I've heard of markets with great home price appreciation but have not heard of anything like this. What part of the country are you in?

I’m in Wisconsin.

This house sold for $250k in 2015, for $380 in 2020, and the zestimate is $500 now, and I can well believe it because other houses on our street have been snapped up in that range and frankly, ours is bigger and has a bigger yard, like .5 acre size.

We haven’t really done much yet. The furnace and a/c were replaced as part of our purchase and we’re on the list for windows. It either needs to be painted or we need new siding.

But it’s a very very pretty neighborhood in a city with rapid growth.

We are in CA (SoCal).

Our direct neighbors house just sold. They purchased the home new at 793k in sept 2019, and it just closed at 1.55M. New home, so not much done at all besides landscaping.

That’s +95% in <3 years.

When we bought, we compared two different homes, both at the same price:

2/2 900 sqft 1964 build, in a good location, <10 min commute / $800k.
4/4 3300 sqft 2019 build, in an ok (relative) location,  30 minute commute / $800k.

The 2/2 has since appreciated to $1.2M
The 4/4 has since appreciated to $1.6M

Glad we went with the McMansion! We also now WFH so the commute time is irrelevant to us. SoCal seems to be booming and incomes continue to increases.

Maybe things will invert as employers try to put an end to WFH and markets reset, but either way ... we now have such a large equity buffer + <3% 30yr fixed mortgage that we should be good for the long term.

[Just Joe]

I hear you there! we have only been in our house 5 years, and it has gained half of its original value. And we thought things were high when we bought it!

Exactly. DW and I were talking about that same thing.

[Polaria]

Well, in theory your wages (if you’re working) and assets should also keep pace with inflation, to keep you neutral. In theory.

How many of us got 8% raises last year?

In Belgium, salaries and Social Security allocations are increased according to inflation by law. So it is indeed foreseen that everyone in my industry gets a 8% inflation-linked raise as from 1 January 2023. The inflation-linked raise for this year was 5%.

Some industries even have monthly inflation-linked raises.

Let me tell you the employers are not happy about that!

[Cassie]

Cranky, Madison is the most desirable city in Wisconsin hence the increasing home values. With the biggest university in the state that won’t be changing anytime soon.

[Dicey]

Lol, this thread inspired me. Our library is having our first book sale since the pandemic began. We have so many books, we decided to keep our prices the same as before. I posted the sale as an "inflating beating" event. It's not over yet; so far the traffic has been excellent.

[Cranky]

Cranky, Madison is the most desirable city in Wisconsin hence the increasing home values. With the biggest university in the state that won’t be changing anytime soon.

I think it’s the tech/healthcare companies like Epic that are really driving the growth - the university seems pretty stable in size.

[BlueMR2]

Well, in theory your wages (if you’re working) and assets should also keep pace with inflation, to keep you neutral. In theory.

How many of us got 8% raises last year?

Well, I gave myself an 11% raise by changing jobs after the prior job failed to follow through on a raise I was promised late Summer but still had not received end of Winter...  :D

[jim555]

Generic Walmart Pepto Bismol 2 pack was $2.96 last year, now $4.98.  Only a 68.2% increase.   I'm sure it doesn't cost them 68% more to make this stuff.  I call BS.

[GuitarStv]

Generic Walmart Pepto Bismol 2 pack was $2.96 last year, now $4.98.  Only a 68.2% increase.   I'm sure it doesn't cost them 68% more to make this stuff.  I call BS.

What is that stuff for anyway?  I always see it in stores, but have never actually known anyone who used it.

[jim555]

Generic Walmart Pepto Bismol 2 pack was $2.96 last year, now $4.98.  Only a 68.2% increase.   I'm sure it doesn't cost them 68% more to make this stuff.  I call BS.

What is that stuff for anyway?  I always see it in stores, but have never actually known anyone who used it.

Upset stomach.

[Arbitrage]

Turns out that some of what appeared to be inflation for us was just some asshat new managers at the local 7-11.  Cranked up the Slurpee prices from ~$1.79 to $3.99 for a medium (initially hiding the new prices as well).  I was flabbergasted when I bought the kids' last Slurpees.  We've been avoiding it in the months since then, but I finally was motivated enough, due to sufficient begging, to take a bike ride to the next-closest 7-11, which is a couple of miles away.  Prices are still $1.79 there. 

Though it's way less convenient, I'll be damned if I'm going to pay 4 bucks for a Slurpee, so 4 mile roundtrips for a Slurpee it is.  Just need to make sure I've got a decent cup holder setup for my bike.

[nereo]

TIL: Slurpees are still a thing.

[Adventine]

Generic Walmart Pepto Bismol 2 pack was $2.96 last year, now $4.98.  Only a 68.2% increase.   I'm sure it doesn't cost them 68% more to make this stuff.  I call BS.

What is that stuff for anyway?  I always see it in stores, but have never actually known anyone who used it.

Upset stomach.

@MustachioedPistachio drinks it for this exact reason, and likes the taste of it. I think it tastes like ass.

[MustachioedPistachio]

If they made a Pepto-flavored ice cream, I'd have a constant stock. Or Pepto-syrup...or...or...

[Tigerpine]

Generic Walmart Pepto Bismol 2 pack was $2.96 last year, now $4.98.  Only a 68.2% increase.   I'm sure it doesn't cost them 68% more to make this stuff.  I call BS.

What is that stuff for anyway?  I always see it in stores, but have never actually known anyone who used it.

Upset stomach.

@MustachioedPistachio drinks it for this exact reason, and likes the taste of it. I think it tastes like ass.

Really?  You think ass tastes like pink chalk?  LOL

On Monday we had our MA state inspection, tire rotation and oil change (synthetic) for less than $150. So that's not bad.  I think that's about the same as last year.

[lifeisshort123]

The fact is these companies are charging well beyond the numbers I am seeing displayed as inflation numbers.  Certain car repairs are costing me 30-40% more than last year.  Ask anyone doing home improvements and they are telling you the cost of those repairs has doubled.

I’m trying to beat inflation by really taking a look at every single last expense.  Wasting less than in the past in terms of items, using up more of what we have, etc.  It’s also just a better and less wasteful way to live.  Also definitely postponed a few trips.

Oh, and also working to get promotions/raises helps.

I consider myself fortunate that inflation will not meaningfully affect my ability to have a decent standard of living.  I am sure that many people right now are hurting extremely by these price increases and having to take on credit card debt, forgo surgeries, etc.  It makes me almost feel guilty about the incessant amount of complaining I do about inflation, but I can’t help myself.  It is horrible to wake up every day and realize your dollars are worth less than the day before.  I’m hoping buying some iBonds will help with that, though I question whether I’d actually want to hold them long term.

[jim555]

Some good news, gasoline is headed below $4.00 by me.  Also lots of discounts are popping up for large sized items like furniture, appliances, as these retailers have no place to store these items so they are getting marked down as supply chains are improving.

[EscapeVelocity2020]

Gas prices coming down has been good for us non-Mustachian car users.  On the flip side, I'm getting my ass kicked on property taxes and insurance premiums.  Since I don't have a mortgage, I could technically skip home insurance, but I'd be 110% screwed if a hurricane wiped me out.  That inflation bonus I got last May is starting to feel stretched.  If I can hang on 2 more years, we'll have an empty nest and can move forward with downsizing...

[YttriumNitrate]

Gas prices coming down has been good for us non-Mustachian car users.  On the flip side, I'm getting my ass kicked on property taxes and insurance premiums.

I follow my county's auditor and assessor on Facebook, and last week one of them mentioned that homestead values are up 18%. Next year's property tax bill is not going to be fun.

[Cranky]

Gas seems to be $3.39 most places here. Doesn't seem unreasonable.

Eggs (conventional) bounced up to almost $4/dozen at Aldi for a few weeks but were down to $2.89 again this week, which is still pretty high but... OTOH, avian flu is circulating again.

[K_in_the_kitchen]

Gas seems to be $3.39 most places here. Doesn't seem unreasonable.

Eggs (conventional) bounced up to almost $4/dozen at Aldi for a few weeks but were down to $2.89 again this week, which is still pretty high but... OTOH, avian flu is circulating again.

Eggs were $2.37 per dozen at my Aldi yesterday, which is cheaper than anywhere else.

Meat prices are still inflated but there were some good deals this week.  Boneless skinless chicken legs were $1.29 per pound at Aldi, and my regional chain had USDA Choice chuck roast for $3.99 per pound and USDA Choice top sirloin steak for $4.99 per pound.  This store always has good quality meat. So this week we are eating chicken, pot roast, and steak, and I added some chicken and chuck roast to the freezer.  Grapes were on sale for 95¢ per pound, so that's this week's fresh fruit, along with bananas and some decently prices apples.  I just don't get attached to any specific cut of meat or type of produce.

Gas is down to $4.78 at Sam's Club and Costco (but our Costco is a nightmare for gas right now since they are rebuilding the gas station).  At the Sam's Club my kid uses gas is only $2.84 per gallon.  But even though gas is high here in California, I can count on my property taxes not going up an insane amount, due to Prop 13.  My assessed value is about 40% of my home's current value (and I'm choosing a low estimate of value).

[lifeandlimb]

Can't seem to beat it, but minimizing its effects by:
- Raising my freelance contract rates by about 6-7%. I had already started doing this with a couple clients but raised rates across the board this year and tried to stick to them instead of negotiating.
- Got a raise at my side job and have been taking on a couple extra shifts
- Buying more generic brand grocery items than before (oh how I love my premium grocery foods!)
- Canceled a few monthly/annual subscriptions for non-necessary services

[GuitarStv]

So . . . should I be buying more guitars now, knowing that they'll be more expensive in the future due to inflation?

[YttriumNitrate]

So . . . should I be buying more guitars now, knowing that they'll be more expensive in the future due to inflation?

The answer to the question "should I buy more guitars?" is always yes.

[Just Joe]

Decided to rebuild my utility trailer rather than buy another. Less than $50 in paint, lots of sandpaper and wire brushing, a bunch of time spent correcting wear and tear damage. Oh and a new floor (piece of pressure treated plywood that offspring#1 painted for me). Tires are less than a year old.

Allows us to do pickup truck stuff without owning a pickup truck. Easy tow with four cylinders.

[bigote2032]

So . . . should I be buying more guitars now, knowing that they'll be more expensive in the future due to inflation?

The answer to the question "should I buy more guitars?" is always yes.

haha, this made me laugh, it sucks that the answer is always yes, I bought four PRS Private Stock during pandemic and now wondering what I have done that the market crashed, when I could have put all that in my stache.  MMM would punch me in the face super face for this, lol!

[GuitarStv]

I bought four PRS Private Stock

Holy crap . . . what did that set you back?  20-40k?

[mm1970]

Got a >20k raise

[bigote2032]

I bought four PRS Private Stock

Holy crap . . . what did that set you back?  20-40k?

It was 38K with taxes an everything, two of them brand new and two used.  This PS lose value a lot, can find some for 6K to 7K.  I just need to make sure I play the crap out of them :)

[GuitarStv]

I bought four PRS Private Stock

Holy crap . . . what did that set you back?  20-40k?

It was 38K with taxes an everything, two of them brand new and two used.  This PS lose value a lot, can find some for 6K to 7K.  I just need to make sure I play the crap out of them :)

I've never played any of the fancy PRSs . . . they sure look pretty, but I've been scared I might grow enamored of one.  :P

[bigote2032]

I bought four PRS Private Stock

Holy crap . . . what did that set you back?  20-40k?

It was 38K with taxes an everything, two of them brand new and two used.  This PS lose value a lot, can find some for 6K to 7K.  I just need to make sure I play the crap out of them :)

I've never played any of the fancy PRSs . . . they sure look pretty, but I've been scared I might grow enamored of one.  :P

Oh yeah, for sure, they can be addictive, but I did put a lot of extra money in the market during the pandemic and recently during this market crash (got some extra $ from consulting in last few years).  I guess it could have been worse, I had a bunch of other guitars in my Reverb favorites I could have dump that money to.  But I think I am really done with buying guitars, so hoping I don't find more hobbies on my path to FIRE that slow me down.  I sure hope I never get into fancy sports cars :)

[BlueMR2]

Well, it's been really great having cut our costs the last few months and being able to stash more money from jobs that paid more.  Looking at potentially both of us losing our jobs in the next couple of months now...  Already hit our numbers a year ago, but it would hurt to go full RE when things are down so much.  Was hoping to make it another year and a half or so to decrease our risk further.  Oh well, life is what you get, not what you want...

[oldladystache]

I just signed up for a credit card that has a 0% introductory rate for 21 months. It also has a signup bonus and 3% back on many things I normally spend on.

I plan to put most of my normal purchases on the card for 20 months, then pay it off with money that has been earning at least 2% and probably more.

Every little bit helps.

[MoseyingAlong]

I just signed up for a credit card that has a 0% introductory rate for 21 months. It also has a signup bonus and 3% back on many things I normally spend on.

I plan to put most of my normal purchases on the card for 20 months, then pay it off with money that has been earning at least 2% and probably more.

Every little bit helps.

@oldladystache Hey, what card did you use?
I have a semi-large purchase coming up and would like to maximize it. However, I'm way over 5/24 so most Chase cards are out. And looking over DoctorOfCredit.com, seems like I've churned thru most of the good ones.

[lifeisshort123]

I love the 0% on purchases credit cards.  Very helpful indeed.

Mostly, I am cutting back.  Getting fuel from the discount club only, less eating out, combining trips, examining subscriptions and cutting back on them, less travel.

Also, picking up new projects at work which led to a 11% bump helped as well. 

[oldladystache]

I just signed up for a credit card that has a 0% introductory rate for 21 months. It also has a signup bonus and 3% back on many things I normally spend on.

I plan to put most of my normal purchases on the card for 20 months, then pay it off with money that has been earning at least 2% and probably more.

Every little bit helps.

@oldladystache Hey, what card did you use?
I have a semi-large purchase coming up and would like to maximize it. However, I'm way over 5/24 so most Chase cards are out. And looking over DoctorOfCredit.com, seems like I've churned thru most of the good ones.

It's from Bank of the West. They sent me an offer in the mail a month or so ago and I didn't have any major purchases planned so I didn't respond. then this week they sent a better offer and I have a few largish things coming up so I took it. I don't know if that's an offer on their website.

[SotI]

Got a >20k raise

Congratulations!

I got a 2% raise (standard), so it's clearly not covering inflation.
So, no way of beating it. My only answer is to cut non-essential expenses.
Which doesn't help much considering our already frugal consumption.
I am heavily invested in global markets and the US, however. This compensates for EUR depreciation to some extent.

We renovated some things this year that were initially planned for 2025 while mat prices were rising but still reasonable. This is a bet on continuous inflation, though, not a solution.
In summary: sorry, not beating inflation.

[stoaX]

Got a >20k raise

Congratulations!

I got a 2% raise (standard), so it's clearly not covering inflation.
So, no way of beating it. My only answer is to cut non-essential expenses.
Which doesn't help much considering our already frugal consumption.
I am heavily invested in global markets and the US, however. This compensates for EUR depreciation to some extent.

We renovated some things this year that were initially planned for 2025 while mat prices were rising but still reasonable. This is a bet on continuous inflation, though, not a solution.
In summary: sorry, not beating inflation.

Yup. 

I'll add that, as someone already retired, I doubt my investments this year will outperform last year, or the year before.  So no "raise" for me.

[engineerjourney]

Went from two kids in daycare ($576/week) to only one kid in daycare ($335/week)... but then my electric bill this month was DOUBLE what my highest bill had ever been previously... between high temps and increased rates.. yeah brutal.  Also just filled our home heating oil tank for just under $900.... rough month for utility bills here.. no longer going to pretend we are beating inflation.  Just going to deal with it and try to reduce what we can. 

[Arbitrage]

Continue to lose in almost every way, since I don't consider cutting back (which we are largely not doing anymore than we already were) to be beating inflation, and neither my wife nor I have received a raise since early 2022 (which was based upon mid-2021 numbers, and amounted to 2.9%).

One place I did beat inflation recently - I finally gave up on my Pixel 3 phone, which I had on Google Fi for the past four years, received for free way back when.  Scoped out a deal on a new Pixel 6a on Xfinity Mobile - again free, paid off with monthly credits over 2 years, at which point I can switch providers. 

Sure, I am stuck with Xfinity Mobile for that time, but I also was able to cut my monthly plan price from ~$27/month after taxes (pay as you go data) with Google Fi to ~$17/month after taxes (1 GB included, which is more than I use) with Xfinity.  Win all around.  I'll take them where I can get them.

[slugsworth]

We got solar semi-recently and just replaced our 30+ year old gas furnace with a heat pump. This avoids an unexpected furnace replacement and removes the monthly operating costs if the HVAC due to the solar.

Next steps are removing the other gas appliances to get rid of the monthly gas fee entirely.  We were sitting on some cash and this seemed like a reasonable hedge rather than plowing into the market.

[elysianfields]

Went from two kids in daycare ($576/week) to only one kid in daycare ($335/week)... but then my electric bill this month was DOUBLE what my highest bill had ever been previously... between high temps and increased rates.. yeah brutal.  Also just filled our home heating oil tank for just under $900.... rough month for utility bills here.. no longer going to pretend we are beating inflation.  Just going to deal with it and try to reduce what we can.

Holy SHIT @engineerjourney get rid of your home heating oil system ASAP - the Inflation Reduction Act wants you to buy a heat pump and solar panels.

[Dicey]

I grocery shop backwards, using the Pantry Principle. I shop to fill my pantry, then I make meals. I start at Grocery Outlet (typically on Senior Morning for 10% off) and/or the 99 Cents Only Store. Then I fill in at Costco or Sam's. It's kept me kind of insulated from shocking grocery price increases.

This week, I was tired so I stopped at Sprouts to grab three things to make an easy hamburger/veggie burger/salad/fries meal for three adults.

I bought three items

Whole Wheat hamburger buns, 5.99,
20 oz. Crinkle cut sweet potato fries, 6.49
Big box of mixed greens, 5.99

That's nearly twenty bucks, gah! I guess I'm officially losing this beat inflation game. I won't change my shopping habits, but damn, I'm going to bake some buns from scratch and freeze them.

I cannot imagine how stressful this is for financially strapped families. I do know our regional food bank is supporting more families now than at the peak of the pandemic. I know because I'm helping to organize our annual city-wide food drive again. It's an exciting thing to do, but it's just a drop in the bucket.

If you're still beating inflation, maybe think about sending a few bucks to your nearest food bank, because food insecurity sucks.

[Cassie]

I grocery shop at Winco because it’s the cheapest store locally. I know that they are in California.

[Ozlady]

i have increased 3 of my rentals so far..and also swapped around term deposits/ bank accounts  regularly to ensure i get the best rates for my cash..

Must say it really helps when one has no mortgage on one's own house ..

[Dicey]

I grocery shop at Winco because it’s the cheapest store locally. I know that they are in California.

Ooh, I loves me some Winco! I would murder for one close by, but rents are insanity here. In my working days, there was a Winco I hit up on my way home from a regular road trip, but now that I'm FIRE and don't go that far, getting to a Winco is a pain in the ass, sigh.

Happily, where our rentals are, we have Winco and Aldi, yippee. Alas, we only go there once or twice a year. OTOH, that means there are no problems and no tenants turning over. MPP for sure.

[Insert a nice long pan of Dicey swooning over Winco's bulk bins here.]

I also adore Winco for the same reason as Costco: They pay their employees a living wage, and then some. Nice.

[EchoStache]

How we were affected by inflation:

We bought a new house in June.  We bought a lot of furniture and stuff to furnish the house, but purposely kept the amount of "stuff" we bought to furnish and decorate at a minimum.

How we are minimizing the effect of inflation:

-For our family of five, all 18+, we are keeping the same weekly grocery budget as we have in the past but sticking to a CASH budget each week, and making more frugal choices at the grocery store.  It's working fine and we are eating well; don't feel like we are sacrificing. 
For example:
Sams's Club(free membership as veteran); 85% lean hamburger $4.18 lb for 18 frozen patties.  We live in Amish country in PA so we have access to numerous roadside fresh produce stands.  Just got 5 lbs of potatoes for $3!!

-We are sticking to the same monthly "eat out" budget that we always have.  Again, we use cash.  It doesn't mean we HAVE to spend all the money($200), but we do so without guilt if we do.  And it makes it easy to not go over budget by having cash.  When it's gone, it's gone.

-We bought an EV at MSRP earlier in the year.  So instead of spending $4 in gas to drive 30 miles, we spend $4 in electricity to drive 100 miles.(As traveling healthcare workers, we drive A LOT of miles, driving an old beater isn't the best option)...also $8250 tax credit, sold my Diesel car for $14k, and got 0.9% financing.

-We bought a heat pump water heater; net cost with installation $500.

-Practising energy and water conservation around the house

-2% interest on cash savings(losing to inflation but its as good as it gets)

-$20,000 of savings in Ibonds so far.  Will but another $10-$20k before rate change

-Investing 50% of our gross earnings into the S&P 500.

[bryan995]

We’ve had solar and EVs for almost three years now. Recently added the second EV (F150 Lightning) so gas consumption has dropped to 0. Hauling things from Home Depot to the house in a 8000lb fully electric pickup truck that costs $0 to operate is quite something. Yes .. it was not cheap (paid MSRP), but it also seemed to be a reasonable value play given the high demand / low supply. We shall see.

We have no utility bill now (<$20). The vehicles also cost nothing (extra) to charge.  Solar offsets everything. Even through the recent CA heatwave, cooling was not a problem.  Cost for solar is $220/mo @ 0.99% for 10 years. After that we fully own the system and should enjoy an additional 15 years of $0 cost operation.

The idea was to trade a monthly bill to the utility company for a fixed loan to Tesla for 10 years. So far so good. The hedge is working.

However you can’t hedge everything. We  have 3 in daycare. Even though the kids are getting older, which reduces their fee, overall costs are still increasing …

 $1060/week now - even with their sibling discount …

Stopped at McDonald’s for them the other day. They wanted happy meals. Sure .. once in awhile what a treat !

$22.47 … for 3 happy meals. That’s just wild.

Taking it all together - we are now losing the inflation fight. Really not sure what is worse.  A worldwide recession with widespread job loss and a 50% hair cut to retirement / investments  … all to only slow inflation. Or modest lingering inflation over the course of 2-7 years that everyone does their best to absorb and adjust to.

 Seems we will likely get both - so all screwed no matter what.