Four Things You Can PERSONALLY Do To Beat The Effects of Inflation

September 24, 2022

Written by Dorcas Obenewaa Owusu

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The inflation rate in Ghana continues to rise. As at August 2022, it had risen to an alarming 33.9%.The rising inflation rate means that prices are increasing and the value of your money is reducing. Most people are feeling the heat. Many Ghanaians are struggling to keep up with the cost-of-living crisis.

So today, we’d like to share some tips on how you can beat the effects of inflation on your quality of life and preserve the value of your money. So…let’s begin.

Save part of your money in a high-performing currency

If you save your money in a high-performing currency like the dollar or the euro, you can offset the impact of the cedi’s depreciation. Check with your bank to see if it’s possible to open a dollar savings account. While most of the established banks offer foreign currency accounts, the Bank of Ghana is currently limiting the creation of new USD accounts to combat the loss of value of the Ghana Cedi to the dollar.

However, Wise, an online money transfer company, allows you to easily open multiple currency accounts and save your money in foreign currency for free with no minimum deposits. Accrue is also a beginner-friendly investment app that allow you to save money in dollars.

So assess your options and choose the one you feel more comfortable with. 

Look for a side hustle

Figuring out ways to increase your income is important to offset inflation. Rising prices means that the cost of living is increasing. Now groceries have become more expensive. Transportation fares and fuel prices have increased. ECG recently increased electricity tariffs. 

Unfortunately, income and salaries have barely increased, which means you need to make more money somehow just to maintain your current way of life. This is where having a said hustle comes in handy. Freelancing, tutoring kids and dropshipping are some examples of side hustles you can take up which will help you earn more money. Check out our post on 101 side hustles you can start for little money.

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Currently, the economy is harsh, so it’s better to balance out expenses with multiple sources of income, rather than managing just one.

Invest in fixed income securities

We  won’t go into so much detail on this one because we’ve already written a whole article on different ways to invest your money. However, to reduce the effect of inflation on your money, you can invest in fixed income securities like treasury bills, notes, bonds and mutual funds. Currently, the government is offering high interest on treasury bill rates (around 30% at the moment) which makes them an attract investment opportunity right now.

Keep in mind that investing in securities involves risk so check your risk tolerance and do thorough research before investing.

Adjust spending habits

If you have bad spending habits, now is the time to control them. You can start by creating a budget and cutting unnecessary expenses. By cutting down expenses, you can free up more money to take care of the essentials 

So, there you have it. While the economy is in a downturn, there are some things you can personally do to lower the effect of inflation on your livelihood.

About Mesika

Hey there, my name is Isaac Sesi. I built Mesika to provide free personal finance resources online to help young Ghanaians become smarter about their money.

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