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Managing Credit in Times of Inflation

Posted By: Bluestone Credit Management

Posted: 04th April 2022

For many people, inflation in the cost of living is outpacing average wages. On March 15th 2022, the Office for National Statistics (opens in new tab) said that annual growth in regular pay, excluding bonuses, fell by 1% in the three months to January after adjusting for its preferred measure of inflation – the biggest fall since July 2014.

The outcome of this economic dialogue is that many people will find their spending ability reduced, or even be faced with making hard choices about how to spend what they have.

For people on benefits, towards the end of March, it was reported (link opens in new tab) that Treasury minister Simon Clarke told MPs high inflation “will be reflected” in the uprating figures for April 2023 if the current forecasts come to fruition and the Government will uprate benefits by 3.1% this April. However the inflation rate is expected to average nearly 8% over the year. Even if the Government increases benefits to reflect inflation, it will take time for peoples’ incomes to catch up with the rise in costs seen today.

With money being squeezed, here are some approaches to be considered to try and ease the burden, we hope they help;

  • Treat every penny as a prisoner – interrogate all you expenditure checking bank and credit card statements;
  • Check your direct debits and standing orders – do you still want the items you pay for?
  • Create a budget planner – the Money Saving Expert Tool is a great independent starting point;
  • Challenge any major purchases or projects;
  • Consider downsizing items such as a second car you may have
  • Recognise that there can often be a difference between what you want and what you need


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