Real Inflation

In my article on Taste Inflation, I talked about how over time our tastes for the good things in life tend to inflate. But as useful as it is to think about, a more pressing issues for many families (including us) is real the actual, literal inflation that's driving up costs. When I went searching for information on current inflation rates, I found a lot of people claiming that the government's numbers (2-3% a year) were incorrect / fudged / outright lies. Other's take a more moderate attitude and explain it as a combination of perception, time-line, and variation in shopping habits.

I'm not about to weigh in on the "is the government lying to us?" debate, but I will say this: it doesn't matter what governments or pundits say about inflation, what matters are your own monthly expenses and how they rise and fall. I mean, let's be pragmatic, the fact that electronic prices have fallen doesn't help you if you aren't buying electronics. But just about everyone pays for food and fuel, and these are where prices have risen most sharply.

Food and fuel are not only a large chunk of many families monthly budget, they are also some of your more flexible expenses. You can't exactly change your monthly rent or mortgage payment, but you can adjust your eating habits and transportation choices. We've been noticing the pinch lately and have made some changes to how we operate and what we buy.

I already wrote about using coupons for groceries and household items, but now we're doing even more:

• Eating out? No way! We've been eating out a lot less frequently and have been eating cheap when we do. What do I mean by cheap? First, we stick to places where the cost is low. This includes our favorite hamburger joint and a national subway sandwich chain. Second, we get takeout instead of eating in. That eliminates some of the cost (and increases the health factor of the meal) because we have milk / water / juice at home instead of paying for sodas. In fact, the few times we've eaten out recently have been disappointing... perhaps it's a sign.
  
• Grocery store flip. We used to shop primarily at a local healthy foods chain (similar to Whole Foods) and supplement with visits to the regular chain store. Now we've flipped that. We shop first at the chain and then anything else comes from the healthy store (they have the best prices on free-range eggs for example). By shopping at the "regular" store first, we've been saving a ton.
  
• The juice quandary. I was miffed when our favorite brand of bottled OJ (100% natural, not from concentrate) shrunk the bottles, but kept the price the same. I complained and they even sent me some coupons, but this didn't solve the larger problem. 100% juice was non-negotiable, but we needed to cut the cost. So, we turned to frozen concentrated juice. For a tiny fraction of the price of bottled juice, we can get 100% juice drinks in a bunch of flavors, including orange juice. Is it quite as tasty? No. But it's still delicious, healthy, and far from koolaid. My favorite brand of juices run $1.37 for a "can" that mixes into 64 ounces of juice. And there are a ton of combinations. We've been making popsicles with the juice and also use concentrate mixed with generic soda water to make healthy sodas for special occasions.
  
• Organic... not so much. The one change I do regret is that we decided we simply couldn't continue to buy all organic paper products. It was just a huge budget killer. So instead we've been getting the regular stuff... but using more cloth napkins, rags, and towels to offset the resource usage. I've also been collecting the plastic bags I get from the regular grocery and using them when we walk our dog, as opposed to the special doggie bags we were buying.
• And speaking of the dog... We've always fed our dog a national brand of quality dog food, but after the pet food recalls two years ago (has it been that long already?) we switched to a premium "gourmet" brand. We felt strongly that if we couldn't be confident of the quality of his food, just like ours, we shouldn't have gotten a dog in the first place. So, we splurged. But prices have been edging up and it's becoming an issue. Because we've shown brand and store loyalty, we're about to get a free 50 lb bag of food (which doesn't last that long when your dog weighs over double that) but after that we've decided to switch. Fortunately, our store loyalty is paying off as the owner is going to walk us through other, less expensive options that we can feel confident about. I'm also planning to bake another big batch of dog biscuits when the weather cools off (we have no AC, so it's an issue).
  
• Meat... Finally, we managed to find space for our upright freezer in the town house (we can't have it in the garage because of power issues) and have been restocking it. Our favorite old-style butcher has good prices on antibiotic and hormone-free local meats as well as freebies and bulk discounts. But they're way across town, so we've been consolidating our errands out there and stocking up when we go. That means freezing small portions of deli meats and the like.
• ...and beer (that's two food groups right there). After some discussion and research, we've come up with a way to get brewing again in our new place. Temperature and space are issues, but we think we've figured it out. That means quality beer at a fraction of the price and in nifty blue grolsch bottles.
  
• Lunch money. When our little one started school, we figured she could just eat in the cafeteria. But the choices weren't all that healthy and, while the price was good (like $2.10 a day), we knew we could do better with homemade lunches. But we did splurge on a nice container set with an ice pack insert, an insulated lunch box, reusable plastic drink boxes (much cheaper than the store bought ones), and a hot lunch/drink thermos. So she enjoys her lunch from home whether hot or cold and we don't have to worry about stuff getting "funky."
  

The above items about all about food and groceries. In addition, we've been tweaking the way we drive in order to save fuel. We weren't going to make a big dent here. We're already a one-car family, and our car is paid for and meets our needs well. But we made a few tweaks:

• Magic school bus. We had originally anticipated needing to drive our little girl to kindergarten, but she surprised us by happily jumping on the school bus from day one. Yay for her!
• Not-so-magic commuter bus. I was already busing to work daily since our move. Before, I was close enough to bike in and save even more, but that's not as feasible now (believe me, I tried it). I did arrange to buy bus passes pre-tax through work, which saves a bit. And I walk a half a mile to save about $.40 cents each way on bus fare. Frankly, I need the exercise anyway and it's actually faster to walk than it is catch the other bus and make a transfer.
• The big errand issue. With gas as high as it is, even cross-town trips can have a real cost. We discovered that driving to the butcher's cost us almost $10 round-trip -- and it's not that far away. So we've been trying to consolidate errands and trips where we can.

So, some thrifty changes to help us keep our budget under control and deal with real inflation without going completely cheap. It's always a balancing act, but when you look past your habits and regular patterns, it's possible to find some room to wiggle.