Inflation: Money Spent or Money Saved?

You have undoubtedly seen the rising price of everything from gas to groceries. Everyday items that we need, not just want, are increasing in price what seems like almost daily. Gas prices in many places are over $4 a gallon and milk is more than that. The cost of commodities are one reason for this and the overall rise in prices is loosely described by one word, inflation. Many of us hear this word and cringe. For those of you who aren't sure what inflation actually is, let's just say that it is a rise in percentage rise in prices from year to year. For example, remember when those small packs of gum were $0.25 and now they are $.30. The price of that item increased in price by $0.05, which resulted in a 20% increase in the cost of the product which is also known as inflation.

This might seem like all doom and gloom, but there is a silver lining to this cloud. Consumer product sales are down as a result of the restricted spending that many consumers are having to endure because of the rise in the cost of living. Items such as electronics, clothing, cars, and anything else that can be described as a want in most cases is a consumer product. There are special incentives, slashed prices and even special financing offers that litter the television, radio and Sunday news that are a consumers heaven if they have disposable income.

Electronics are really coming down in price. Look at the prices of HDTVs now compared with a year ago and you will see what I mean. Larger stores will have great pricing on televisions, computers and other big ticket items. Some stores will also knock a little bit off of the price if they can make a sale. Try talking the salesperson into selling the item for a lower price, hey it can't hurt to ask.

Another area that is experiencing a downturn is profit is the travel industry. Hotels, amusement parks and even professional sports teams are offering specials or gimmicks to boost participation by the money spending public. If you do a little shopping around you can probably find a hotel+airfare+attraction package deal or a combination of these. The savings on these things might offset the rising cost of airline tickets or fuel costs so that you can still enjoy a vacation this year without breaking your budget.

Even restaurants and public services like cable, Internet and phone companies are cutting rates and running specials. Combo deals seem to be the choice of these companies. If you live in a metropolitan area most cable companies also offer telephone and Internet services also. Packaging these services together many times means some pretty significant savings. The service companies that you use might also have special deals negotiated with providers of other services that you can take advantage of.

Credit card companies are also offering lower interest rates on a lot of their existing accounts. These offers should be approached with extreme caution. This is a great way to consolidate debt and also save money, but only do this if you are sure that you can pay off the balance before the promotional period ends. This gimmick is really used to encourage spending by consumers so that you rack up more debt, but if used wisely it can save you some money.

Furniture is many times looked over because of the long time periods between purchase for most people. However, if the couch is getting a little lumpy or you could use a new dining room table there are a lot of deals on furniture right now. Special financing offers are rampant with many stores offering no payments or interest for up to 36 months. I wouldn't recommend the no payment part since it would be wise to go ahead and pay as much on the purchase, if not all of it, before the promotional period is over.

Now is a great time to buy large, expensive items. The deals are out there and prices are dropping lower every day. There should be some restraint in your spending spree though. Only buy these items if you have enough disposable income to make and pay for the purchase. If you can pay for the item in full, do it. Don't put a purchase on a credit card if you have the money to pay for it. Also, if you already have debt on credit cards or are having a tough time saving or paying your bills take care of those things first. Buying more items and putting yourself further it debt is not wise, remember even a deal costs money.