Survival Tools For Inflation

The recent fuel subsidy changes, combined with a new electrical tariff structure and higher food prices, will likely cause inflation in this country to jump to a 26-year high in the next few months.

The inflation rate is expected to surge more than 6% with consumer price index (CPI) for 2008 at the average more than 5%. The CPI for May already rose to a 22-month high as a result of the strong rise in food prices.

Experts estimate that for every 10% increase in fuel price raises the CPI by about 0.7% month-on-month. Transport costs are likely to have risen substantially as a result of the toll increased at the start of the year.

Economists and market analysts expect inflation to stay above 7% mark throughout the second half of 2008. Some however, have predicted the inflation rate could be breaching even higher and the 8% mark cannot be ruled out.

Spiraling inflation is actually undercutting the purchasing power of the household income and has gone haywire causing bad economy.

So how are we going to get tough with this problem?

Financial experts have outline a few things that could help us to fight inflation.

1. Don't use extra cash for shopping. This is not a good time. We've got to be more conservative in our spending and be more critical on money in and out. Pay out the high-interest debt and start to save as little as 10% of our income. As a rule of thumb, adjust spending habits.
2. Employees should take more workload to help their companies save money. It is a time they should think like an owner--where can they cut costs?. What're new things can increase productivity. How to make more sales. The survival of a company means the survival of us as the employees.
3. Start a budget so that we can spend within our means