Survival Tips for the Economic Crunch

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With gas and food prices sky high, many Americans are in survival mode -- looking for ways to trim the budget. CBN News explored what families are doing to cut back during these trying economic times.

America Gets a Brutal Reality Check

It seems everywhere we turn, we're reminded of economic obstacles. There's the rising cost of food.

"Our grocery bill has gone up about $100 a month," one woman told CBN News.

Americans are also facing record high gas prices -- averaging around $4 per gallon.

"Gas prices are outrageous," one consumer commented.

"I can't afford this," said another. "Metro's looking good!"

It's no wonder that 60 percent of Americans now say gas prices are causing them "hard to severe" economic hardship.

"The culture shock or the economic shock as a result of $4, even it it's just psychological, will change behaviors dramatically," said Jack Gillis of the Consumer Federation of America.

It already has.

"We'll just keep cutting back," a consumer said.

Americans are changing spending habits just to stay afloat.

"I think that people are looking very carefully at their household budgets and looking for ways that they can get more value for every dollar that they spend because it's competing against high priced items like gasoline," said Scott Hodge, the president of Tax Foundation, a Washington-based non-profit educational organization.

It's becoming a battle of needs versus wants.

"Making sure that what's coming into your pocket every month is more than what you're spending every month," said Kirstin Hark, a financial advisor with Tull Financial Group. "That's really the bottom line, and from there we decide what's appropriate for meeting your needs, and what's not necessary right now."

Keeping Up with the Joneses - Not!

More and more consumers are discovering it's time to trim the fat. Financial experts say there's a cultural mindset these days that less is more. Keeping up with the Joneses now isn't about showing what you have. It's about showing what you don't spend.

Restaurant owner John Haines was totally unprepared for the drop in people eating at his tables.

"We're seeing frequency drop; definitely seeing big frequency drop," Haines said. "Ninety percent of the people I talk to, I mean it, nine out of 10 will say, 'Yeah, we don't eat out at all' or 'We've really cut back.' Are you spending less? Oh yeah.'"

"We eat out less," one consumer told CBN News. "Take our lunch to work."

"Taking lunch," another said. "We quit buying things that we didn't really need."

"We eat out a lot less," a consumer commented. "We used to eat out two or three times a week, and now it's two or three times a month."

Profits are down in nearly half the nation's restaurants. Even Haines admits he's part of the crowd.

"We don't even eat out as much," Haines said. "My wife and I don't. We don't. I need a new car. I'm not buying a new car. I'm just not doing it."

Jeremy Niedzwiecki is choosing to scale back the number of times he drives his car. Two wheels are the mode of transportation these days.

"I bike to work every day that it doesn't rain, anyways," Niedzwiecki said. "That has helped save our gas bill quite a bit. We've gone from a tank a week to about a tank a month."

Jeremy and his wife Beth faciliate a biblically based financial workshop at their church. It's called Financial Peace University which is part of nationally known financial expert Dave Ramsey's ministry.

Another well known ministry is Crown Financial Ministries. It has a similar workshop called Money Map that is taught in local churches.

Some Money Saving Tips

If the thought of biking to work seems a bit much, how about these choices? Consumers shared with CBN News the following cutbacks they are implementing.

"Subscription that I used to have -- I went ahead and canceled most of it because a lot of times I never got a chance to get to it anyway," one woman said.

"We've removed cable out of our house," a man told CBN News. "We've cut our internet down to the slowest connection."

"Using a lot more coupons and things like that," one consumer commented.

"Trying to consolidate our trips so we're saving gas," another said.

Some Americans are saving money by cutting back on daily luxuries like that $4 cup of mocha. They brew their own coffee and add a little chocolate syrup.

Others have chosen to push aside the bottled water, and instead fill up their own bottles with tap water. They then keep the bottles cold in the refrigerator.

However you choose to save, Christian Financial Advisor Kirstin Hark says don't neglect God in your spending plan.

"There's both the requirement that God places to be giving generously to His purposes, and at the same time, also reminding us that there's a reward in being faithful to what He's asked us to do regardless of our circumstances," Hark said.

He'll also give us wisdom when we ask.

"We just cut back on all the frivolous stuff," Beth Niedzwiecki, Jeremy's wife, told CBN News. "We buy things when we need them, and we just stop when the money's gone."

Stop when the money's gone. It's a new concept for many people in our credit-crazy society, but in these tough times, it appears to be catching on.

Originally Published May 5, 2008

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CBN News
Mark Martin

Mark Martin

CBN News Reporter

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