If you find that your income isn’t paying your bills, it may be time to consider some of the more significant ways you may be able to save money this year. Every dollar you save provides a dollar that you can put toward paying down your debt, which is vital in 2023, as interest rates on items like home mortgages, automobile loans and credit card debt increased in 2022. With the Federal Reserve expected to continue increasing its benchmark interest rate to combat inflation this year, rates on some loans many continue to increase.1 While mortgage rates may decrease from their 2022 levels, they will still remain higher than in recent years.
Debt accumulates fast and there are several debt relief options such as bankruptcy to explore before it overwhelms your life.
The information below will help makes sense of what is happening as well as what you can do.
Groceries prices have risen 12 percent in the last year according to the Consumer Price Index, which translates in practical terms to about a $24 increase on each $200 grocery bill in 2022.2 While inflation is easing overall, some of the major factors affecting food prices will linger into 2023. These include the war in Ukraine, which supplied fertilizers and animal feed to U.S. farms, and extreme weather conditions that have affected crops grown in the U.S. and other countries.
One of the food items whose price has increased the most is eggs, which are a major source of protein for many families and the building block of many other products. The most recent avian flu outbreak has resulted in the loss of 57 million birds across 47 states3 which has reduced the supply of eggs dramatically and thus, increased the cost of eggs. Consumers on average are paying twice as much as they paid last year for a dozen eggs, with the median cost in the U.S. at $4.25.4
Overall, about nine percent of Americans’ non-discretionary spending is on groceries and five percent is on utility costs.5 While you have to eat, there are a host of ways to save money on food, from reducing meat and poultry consumption to growing and preserving your own vegetables.
There are also ways to save on your energy bills. The AARP website contains an informative article which lists 99 ways to save money, with 14 of those ways dealing with saving on groceries and 16 having relating to saving on energy and car costs. Click here.
Rents and mortgages make up the largest percentage of Americans’ non-discretionary spending, coming in at a whopping 31.5 percent.7 Refinancing at a lower interest rate is the best way to save on a mortgage, but there are other ways to save. Zillow has compiled seven ways to save money on your mortgage. Click here.
While these are just a few of the areas where you can save a buck or thousands of dollars, there are a host of articles online which provide other money saving tips. The time you spend researching and acting on these tips is time well spent, as it will keep money in your pocket that can be used to pay down your debt. Becoming debt-free can reduce your anxiety and provide a more solid future for your family. However, if you feel that no matter how much you try, your debts are out of your control, it is best to seek professional advice from a bankruptcy lawyer.
Choosing Personal Bankruptcy
Bankruptcy not only provides debt relief for those who qualify, it also helps the debtor gain some financial control and put a plan in place for the future. Hines Law in Massachusetts specializes in Chapter 7 and Chapter 13 bankruptcy and are here to help. With several locations throughout the greater Boston area, there is a bankruptcy attorney available to help decide which option is best for your situation.
If you have questions, need advice or want to file personal bankruptcy, call our bankruptcy firm and speak to an experienced lawyer for a Free Consultation.
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1 Mortgage Interest Rates Expected to Drop in 2023, by Mike Winters, 1/5/2023
Link: https://www.cnbc.com/2023/01/05/mortgage-interest-rates-expected-to-drop-in-2023.html
2 Consumer Price Index: How Much Did Inflation Impact Grocery Prices in 2022? by Selena Fragassi, 12/31/2022
Link: https://www.aol.com/consumer-price-index-much-did-183037535.html
3,4 Why Are Egg Prices Still So High? It’s Not the Reason You Think, by Anthony Tellez, 1/12/2023
Link: https://www.forbes.com/sites/anthonytellez/2023/01/12/why-are-egg-prices-still-so-high-its-not-the-reason-you-think/?sh=758f3f1e7c6b
5,7 The Spending Habits of Americans, by Marc Davis, 8/27/2021
Link: https://www.investopedia.com/financial-edge/0512/the-spending-habits-of-americans.aspx
6 99 Great Ways to Save by Beth Braverman and David Schiff, 1/19/2022
Link: https://www.aarp.org/money/budgeting-saving/info-2022/99-great-ways-to-save.html
8 7 Ways to Save Money on Your Mortgage, 10/28/2010
Link: https://www.zillow.com/blog/7-ways-to-save-money-on-your-mortgage-29422/