How are we coping?
Being as frugal as possible.
Our largest expense, and it's not even close, is taxes. We work a side job to pay taxes so we can keep our main paychecks. It may only be 12-22% to the Feds, but add in another 7% for social security/Medicare, 5% to the state, 3% local, then toss in property, vehicle, sales, fuel, utilities, tax on insurance, and it's close to 50%. If you want to give relief to the middle class, start here.
Health costs-insurance increased 50% through my employer this year. It's the largest dollar increase ever. We max out HSA cards to lower income and have the funds on hand for medical bills. My insurance has increased over 400% since 2013, after it was stated costs would drop.
Other ways:
-our son decided to hit tech school/community college instead of the 4 year degree we had saved for. He graduates this year with a 2 year degree and already landed a permanent job making just a few dollars an hour less than I do at 46. It saved around $40,000 in tuition, and he makes nearly 50K a year, at 20 years old and no college debt. If he wants to continue to a Bachelor degree, he now has the income to do it, or his company will chip in.
-vehicle negotiation-we bought a Mazda CX-7 new in 2010 for 24K. We decided to replace the car with a Toyota Rav 4 and was able to get a loaded model with a $29,991 sticker price for $23,900. We have a nicer car, more safety features, and better reliability, for less than we paid 9 years ago. Our insurance also dropped $400 a year due to the safety upgrades.
-credit card rewards-everything possible is charged if we were going to pay it anyway. Cel phones, cable, water, insurances, tuition, fuel-all are costs that we can get some points from. This assists with vacation costs big time, from free/reduced hotels with free breakfast to free/discounted flights. We're finding it cheaper to fly to Europe than to west coast cities like Seattle and San Francisco from KY. We have RT flights to Paris in Sept that we paid $399 RT for from Lexington(on CC rewards, it was free). I looked at a Seattle trip in June and the tickets were $550 a piece.
We try to buy anything possible through web portals to stack points/savings. I had a $200 Lowe's order for yard goods last week. Went to Kroger and bought a $200 Lowe's gift card on Chase Freedom to get 5% back. That also gave me .80 off in fuel, or $28 off 35 gallons. In addition, I went through the SW airlines portal and received 100 miles for the purchase. The points=$10, we get $28 off fuel, and a few miles were added off a purchase I was making anyway.
-We've looked at pulling the cord on cable, but need high speed internet to work from home. Taking the cable portion off would increase the bill to the point that any other type of cable replacement(hulu, youtubetv, etc)would actually make it more expensive than the combo bill now. My wife and I are using older cel phones, not much savings there plus our area doesn't have the strongest signals in the world so switching carriers is out.
-Groceries-I'm not seeing the spikes that many are reporting in my part of the world. Meat seems cheaper than several years ago. Seasonal produce remains affordable, dairy prices are stable, bread hasn't gone up. Some individual stores have raised some prices, but others have not. It pays to look at ads and shop where the deals are.
-Fuel-it seems like a big jump but heard today it's only a dime a gallon more than this time last year. Gasbuddy is your friend, along with Kroger fuel points. We are driving back and forth to Louisville to visit a family member in the hospital several times a week(140 miles RT) and Gasbuddy alerted us that an exit we pass has fuel for $2.47($2.44 with Speedy Rewards card). That's .25 cheaper than by our home. Take $3-4 off each fill up twice a week and it adds up.
Disney-we bought DVC in 2013 resale for about 50% less than resales at the same resort are going for now. Tickets are gold AP's, bought through ticket bridging to save about $80 each. We do grocery orders and eat very little in the parks. Our largest expense there are flights, the second largest expense ironically is dog sitting.
Lots of way to adapt to increasing prices.