InvestigateTV - This summer the U.S. Bureau of labor and Statistics reported the largest increase in inflation of the last 40 years, which has led to a shift in American spending habits.
Michael Joyce, with the financial firm Agili, said inflation can get in consumer’s heads.
“One of the big problems with inflation that we had 40 years ago was it got in people’s psyche and their mindset.” Joyce said. “It became a self-fulfilling prophecy, and if that turns out to be the case, then it’s going to take a lot longer for inflation to come down.”
Joyce suggested one way to limit your spending is by using cash instead of credit cards.He said the strategy is helpful in several ways:
- It forces you to make smart money choices when you can see the cash changing hands.
- It keeps you from overspending.
- Most consumers carry limited amounts of cash, making it easier to stick to a budget.
- It stops you from racking up debt with high interest if you are not able to pay off your credit card in full each month.
However, Joyce said if you are able to pay off your credit card each month, you can use them and build up points for rewards.
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