Don't get angry, get even. Take the Power Back when it comes to your $$$.

You don't have to be an economist to understand the effects of inflation. You feel it every time you shop, whether purchasing a flight, veggies or even dog food.
We've all become numb to these sky-high prices but tend to experience at least a weekly price shock.
Last week, I had mine at the Countdown in the pet food section, which has been hallowed out recently due to supply chain problems.
I gasped recently when I saw my dog's favourite brand shoot up by $2 a tin. Not to $2 but up by another $2. I bought one and then went looking elsewhere. I found it  $1.30 cheaper somewhere else and loaded up.
Because we don't live off dog food, these are marginal savings. You're not likely to notice a huge difference in isolation. But if you apply the same vigilance in the hunt for savings across all spheres of your personal finance life, you may see a difference, even if you have to squint. 
You might need to stock up on eye wrinkle cream the way things are headed. 
Despite the government hoping for inflation cooling, the latest numbers show no change. Okay, it dropped 1/10 of 1% from 7.3% to 7,2%. Big deal! 
To add insult to injury, we've also been dealt a further blow with a sharp decline in asset values in both the housing sector and the share market. The average KiwiSaver Growth fund is down by 10% year to date. Yup, it's painful. 
You may console yourself by remembering that KiwiSaver (unless you're saving for your first home) is a long game. So think long-term and take a deep breath, right?
Even then, when you look at the long-term returns, those sunny days of 11% p.a. returns are fast fading from memory. Across all peer group averages, they've sunk around 2% p.a., pulled down by the recent meltdown, er, should I say 'correction.'
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To compare returns and fees over the life of KiwiSaver, follow Morningstar's quarterly KiwiSaver reports here. 


Looking on the bright side, you could choose to look at today's deflated share prices as a discount. We're entering a bear cycle, but it won't last forever. So anything you buy now will likely rise again. We just don't know when. 
​When KiwiSaver first launched in 2007, it was around the time of the Global Financial Crisis. Back then, default funds (which were Conservative in profile, not Balanced as they are now) and actual Conservative Funds, withstood the blows better than their Balanced, Growth and Aggressive counterparts.
It was demoralising for first-time retirement savers still trying to wrap their heads around KiwiSaver, but those who stuck it out were rewarded in the end with much higher returns.
From that low, we saw one of the longest bull runs in some time, including housing. Markets were almost gravity-defying. They kept going and going, even through Covid, a byproduct of Central banks printing money to prevent total economic ruin.
Fast forward to 2022, when we should be celebrating to return to quasi-normalcy in a sorta-post-covid world, we get slammed.
The effects of all that cheap money finally caught up.
​Hence, inflation is at 7% and higher in some places. And interest rates creeping back up to levels that younger investors will have never experienced.
I still remember when my sister bought her first home. We were all very excited for her. Her interest rate was a whopping 14% something that is unimaginable to today's borrowers.
I'm not forecasting or suggesting we're headed back to these crazy highs. Far from it, it would create mass homelessness in New Zealand.
Reckless lending?
Banks deliberately build a buffer when assessing your ability to service a mortgage. It's called stress testing. Currently, many of them are stress-testing would-be borrowers at 8%. With inflation, what it is, many hopefuls will be knocked out before their first meeting.
Since June 2021, fixed-rate mortgages have increased by almost 4%. On an average mortgage of $650k, you'll be paying around $1,000 extra monthly to service your debt.
The pain is real if you have kids or pets, drive a car, and like to eat.
Personal loans are rising in popularity, and food banks are busier than ever. People are struggling.
So easy wins to reign in costs include the following:

• Cut out unnecessary subscription services, including Spotify, Netflix, Neon, Unused Gym memberships, Audibles, etc. You want to leave some room for joy, but if you aren't using these services, can them!
• Compare power companies: Use MoneyHub and or Consumer's PowerSwitch to see if you can find a better deal, and don't procrastinate taking action. "Just do it." 
• Likewise, do the same with your Insurance: car, health, house and home contents. It used to be by using the same provider, you could get a discount, but pricing these days is volatile, and competition means that you can often get a better deal by unbundling Insurance. Obviously, READ THE FINE PRINT to ensure you're paying for what you need and there aren't any unexpected fish hooks.
• Shop around for food. Costco's annual membership fee of $60 will quickly be recovered on your first shopping day. Meal planning also saves money, as does online shopping, when you can better avoid impulse buys. 
• Walk, bus or bike where possible to save on petrol. Most of us need the exercise anyway, plus its good stress management. 
• Sell unwanted goods on TradeMe or other online marketplaces.
• Consider a side hustle or another craft to bring in extra income. 
• Don't buy crap you don't need to impress people who don't care anyway.
  
• CLAIM back tax refunds, including school donations and charitable causes. See my earlier blog on how to do this easily using myIR.

This is not an exhaustive list rather it is a starting point for taking back the power.
It is increasingly hard to save but not impossible, and if you approach it like a challenge, you'll find more joy in it. 
When it comes to money, attitude and behaviour are everything. 
We may not be out of the woods yet, but sitting idly with fear, worry and/or apathy isn't going to move the dial. That's on you. 
(The usual caveat applies. This is not personalised financial advice. If you need some, see fee based authorised financial advisor. Check out the FMA website to find out more.