MINNESOTA, USA — It's no secret the price of just about everything is skyrocketing.
The inflation rate is the highest in four decades and experts say there are few signs that it will slow significantly anytime soon.
Mark Bergen is the James D. Watkins Chair in Marketing at the Carlson School of Management at the University of Minnesota and he says he wouldn't be surprised if inflation hits 10%.
"For the last 40 years we've been able to live in a world of very stable prices. Everything has changed now," said Bergen.
Inflation is the general increase in prices - when there's more money circulating coupled with supply constraints.
"Both are happening, which is kind of making that perfect storm," said Bergen.
He says to consider inflation like a tax rate and ask yourself how you would adjust what you're buying given that rate. He offers these three suggestions:
- Budget: He recommends investing your assets in goods you can sell rather than in cash or fixed interest places. He also says to ask your employer to adjust your wages, along with considering trade-offs.
"You might think of smaller sizes, different brands, look more to store brands and private labels," said Bergen. "Pay attention to prices. You haven’t had to in your lives for the last 40 years, you have to now."
- Shop broadly: Bergen says you won't notice prices going up at the same time and they will fluctuate at different stores too.
"Different products will change prices at different speeds and different stores will change them at different speeds," said Bergen.
- Go slowly: Bergen says people are also experiencing pandemic fatigue and that it's important to give yourself grace as you navigate doing more with less.
"Be aware that you may be more short tempered, a little more angry," said Bergen. "Take a moment to think about it, to make sure you're not rushing into things because when we're fatigued, we can make mistakes."
He says it's important to navigate things at a new pace since inflation is sticking around for awhile. We have to get used to decision-making in a different world.
"To me, the hope is even at it’s worst," said Bergen. "We do figure out how to shop and move around, it’s just harder and different and while it’s different, it’s do-able."