How To Prepare For Hyperinflation
Have you seen a recent trend of rising prices that don’t seem to show any signs of going down? Right now, we are experiencing inflation, and I think many of us are a little concerned about the possibility of hyperinflation, so let’s discuss how to prepare for hyperinflation!
What is Hyperinflation?
Hyperinflation is used to describe rapid, excessive, and out-of-control price increases in the economy. While it is rare, once it begins, it can spiral out of control. The price for basic goods, such as food and fuel, will rapidly rise and become scarce commodities.
Hyperinflation is when prices rise by 50% or more per month. This means that if you are seeing gas prices at $4 a gallon, they will become $6 a gallon, then $9, and up each month.
Difference Between Inflation and Hyperinflation
Some Inflation happens all the time and is a pretty normal thing in the economy. According to Investopedia, inflation is the measure of the pace of rising prices for goods and services. Normal inflation is measured in terms of monthly price increases.
In the United States, the one-way inflation is measured is by the Consumer Price Index. Typically, there is an inflation of around 2% annually for certain things, and that is “normal” based on various historical measures.
In fact, some inflation is a good thing because that is a sign of a healthy, growing economy.
In contrast to inflation, hyperinflation is a rapid increase within 30-days. Hyperinflation is when those prices rapidly rise, typically by more than 50% in a month. It is typically measured in terms of exponential daily increases.
This means goods and services will increase in price 5-10% per day! Hyperinflation can have devastating effects on society, including starvation, homelessness, and the scarcity of goods we all need.
What Causes Hyperinflation
Hyperinflation typically occurs during times of war and economic turmoil in the production economy, in conjunction with the central bank/treasury printing an excessive amount of money to cover government-related expenses. Other causes of hyperinflation include:
- Economic Recession
- Economic Depression
- Loss of confidence in the national currency
Are We Seeing Signs of Hyperinflation?
Price increases shocked many economists in 2021 as prices for goods and services rose at the fastest pace in nearly 40-years! Everything from rent to the price for a used car climbed higher as the economy recovered from the pandemic and the effects of supply chain disruptions, but is this inflation actually hyperinflation?
Right now, we are seeing a 6-7% price increase on goods and services as evaluated on an annual basis, so we haven’t hit the definition of hyperinflation…yet! However, that doesn’t mean we aren’t still hurting from that 6-7% increase in pricing of items we use all the time.
Typically inflation is only about a 2% increase, so we may feel like it’s hyperinflation as it hits home on our pocketbooks. So, there’s no better time to learn how to prepare for hyperinflation than now.
How to Prepare for Hyperinflation
With all that being said, economists don’t know how high prices will go, and it doesn’t seem to be slowing down. We could sit around and play the blame game, but we would be wasting precious time.
With prices increasing faster than we have seen in 40-years, it’s crucial to know how to prepare for hyperinflation before it happens.
Pay Off Debt Quickly
This financial step should be your number one priority! Pay off your debt as quickly as possible, especially debt with an adjustable interest rate. During hyperinflation, unsecured credit card companies can charge you ridiculously higher interest rates than what you previously had been paying.
And, maybe even more than you can afford. Get rid of it, now!
If that is a difficult step to take, put a plan in place to pay extra on those cards. The minimum monthly payment expected just won’t cut it since it is designed to take an extended period to pay off the debt.
Try cutting corners in some of your spending habits, and consider taking some of the funds set aside for savings and applying them to your credit cards.
Refinance
If you own a home, now is the perfect time to refinance it for a lower interest rate. Interest rates are at an all-time low, which means refinancing can possibly get you a lower interest rate on your mortgage, and the related reduction in that monthly mortgage payment.
That means you’ll pay less every month on your mortgage which can be life-saving during hyperinflation.
Be aware that the Federal Reserve has recently announced they will be trying to implement measures to slow down the current inflationary trends.
The most effective way they have to do that is to increase short-term interest rates. You can expect to see three or four rate increases during 2022. So, time is of the essence since it takes some time to process a mortgage refinance.
Save, Save, Save
Cut back on going out to eat, Starbucks visits, or even shopping for clothes and shoes. If you don’t absolutely need to make the purchase, don’t. You will need every penny if prices increase significantly.
Unless you have credit cards that need to be paid off, as mentioned above, try putting money in short-term CDs or savings accounts paying as high an interest rate as possible.
You may want to consider setting a target of having at least enough money saved that you could survive 3-months without an income.
Don’t Buy New
One way to save money is to buy used things. Don’t pay full retail price on new items, if possible. Instead, purchase gently used items that will cost you much less.
Garage sales, resale shops, eBay, Market place, and Free or for sale groups on Facebook are all great ways to buy used items at a fraction of the price.
Due to shortages of certain items, like used cars and trucks, even used products are seeing a significant increase in prices. Really think about your NEEDS, particularly on large higher-priced goods.
It is hoped that once the current supply chain bottlenecks are worked out, we’ll start seeing the price of goods and services come down. I certainly hope so!
One step to consider would be to sell items you aren’t using very much or really aren’t needed on a daily basis. That could include the second or third car parked in the garage or driveway. We decided to sell our second car a few years ago.
Sure, it was an adjustment at first, but with some planning and effective scheduling, we’ve gotten along fine. Of course, we are both retired, so it works for us and possibly wouldn’t for dual-income families, or families with kids involved in lots of activities.
Stock Up On Food and Water
As a prepper, I recommend stocking up on non-perishable food for any situation, not just hyperinflation. To help save money in the future, you should stock up on non-perishable foods, bottled water, and meat. If you aren’t sure what to stock up on, check out my recommendations below:
- Canned Foods I Highly Recommend You Store
- 7 Basic Food Items to Stock
- 30 Survival Foods to Stockpile
- Water: Do You Have Enough Stored
Stock Up on Household Items
Not only will food prices increase during hyperinflation, but so will the price of common household items like dish soap, laundry detergent, and hygiene products. Make a list of Essential Items Every Household Needs, and start stocking up before prices climb higher.
Become More Self Sufficient
Food and water may be harder to get your hands on, especially if we start seeing hyperinflation. That’s hard news to swallow when you have mouths to feed. If you can, consider using a portion of your property as a food source.
You don’t have to have a lot of land or live in the country to be self-sufficient. You can do small things like grow a garden, raise meat rabbits, or have a few herbal remedies on hand to help provide more food and financial security.
Stock Medicine and First Aid Supplies
You don’t want to forget about medicines like Tylenol, cough suppressants, allergy medication, and vitamins. Here are 35 OTC Medications You Should Store. In addition to OTC medications, you should also make sure you have a good first aid kit.
Bandaids and Neosporin are not enough! You need a variety of supplies for different injuries. If you aren’t sure what you need, check out my First Aid Kit Checklist, here.
Consider a Side Job
You never know when you could lose your job, and during hyperinflation, that would be devastating. Even if your job is pretty secure, you may want to consider an additional source of income to make sure you have enough money coming in as prices increase.
Having another income source is always a good idea, and could save you from the worst possible situation. Consider things like freelance gigs, babysitting, pet sitting, or becoming a handyman on TaskRabbit.
Final Word
Based on the news I’m hearing, economists don’t see hyperinflation coming. Regular inflation in itself can be devastating to those already struggling or living paycheck to paycheck.
We may not see a 50% increase in prices, but even a 10% jump is difficult to deal with for some families. So, I would recommend stocking up and preparing now because prices may not level out for a while, and any increase can put a strain on you and your family! Remember, luck favors the prepared!
What are you doing to prepare for inflation or hyperinflation? I’d love to know in the comments, below! May God Bless this world, Linda
Copyright Images: Dollar Bill Depositphotos_10569349_S, US Dollar Bills Depositphotos_379337548_S
Inflation might be 7% overall but the most common consumer goods are at 15% or more. That’s why it hurts so much.
Buy It Cheap Stack It Deep
Hi Matt, yes, things are worse than we hear about. We can see it coming more than ever. I choke at prices on things, it’s out of control. I love your statement! “Buy It Cheap Stack It Deep” Linda
Ha great minds think alike. Right before your newsletter came out for today I
emailed you talking about prices for Kraft-Heinz going up. Things like Velvetta, Oscar Meyer cold
cuts and hot dogs, Coffee, Oscar Meyer Turkey Bacon, and Kool aid. We need to help each other in
anyway we can, recipes, tips and anything else.
We can do this.
Hi June, yes indeed great minds think alike. Thank you I saw that great email! Yes, we can do this! Linda
Another great post, Linda. It is pretty scary times we’re living in. Our local grocery store has a Buy One Get One for 1 cent sale on rice and pinto beans. I plan on getting a couple of each. I have bought quite a bit of pintos and rice lately. We are also stocking up on canned goods, mail order from Walmart. I’ll also be buying more flour and such as that. Our gas prices here in East Texas was a little over $3 a gallon last time I went to town. Luckily we are retired and don’t need to go anywhere daily. I try to get all of our trips in one these days. I like staying home. We rarely go out to eat or get something to eat, to go.
Hi Linda and everyone! My husband and I were talking about this just this morning. And then your email! Yes things are getting bad. We stopped yesterday at a hometown mrk walmart, I was craving oranges. They wanted $8 for a bag of oranges, no way!! So here I sit still craving oranges LOL. The amount of empty shelves shocked me. I seen another article about corn shortage and high cost of fertilizer. Farmers can’t afford to plant it. Its all like a domino effect.
Thanks for all your wonerful articles.
Renee
Hi Renee, it’s crazy, right? The grocery stores are bare or nearly bare. Everything is going up in price. I hear you on the oranges. Now, I want one. LOL! I refuse to cave to the prices. Yes, the corn shortage is real and affects everything we eat and drink. Be glad you know how to cook from scratch, it will be critical. Linda
I don’t know where your at or if you have a Gerbes, or Dillions or Kroger but our here in Mid Missouri ours
takes produce that are Older, not bad but older and bag them up and mark them at 99 cents. I just bought 2
bags of Oranges (one with 4 in them and 0ne with 5 in them) for 99 cents a bag. I have been eating Oranges.
They don’t just do Oranges. I have bought Apples, Potatoes, zucchini, peppers, all kinds of things. Check with your local store or if they don’t offer it talk to the produce manager and see if they will start. No need to waste good food.
Hi June, this is awesome to know, thank you, Linda
We are fortunate that we retired just before the pandemic got going and we are homebodies anyway. We don’t spend much money on clothing or gasoline because we take care of errands once every two weeks or so. Husband likes to go fishing so he actually gets out more than I do but his fishing buddies come pick him up. The price of meat is the most concerning for me. At Sam’s Club they had 2 slabs of pork ribs in a package for $300! I almost fainted! So I buy very little meat and am glad for what we have in the freezer. I am going to try canning some which I’ve never done before. Vegetables, yes, but never meats. I’ve been studying my Ball Canning book a lot lately!
Hi Paula, I was afraid to tale that first step i to canning meat but once I did, it was awesome. This year I forcused on canning dinners. That way we always have a fast home cooked meal ready any time.
Pressure Canning for Beginners and Beyond by Angi Schneider is an excellent investment.
Hi Jerilea, I hope Angi Schneider is following USDA guidelines. She and I both have the same publisher for our books. Hers is canning mine is for survival. It’s a personal thing but I only follow the Ball Canning Guide and the USDA Canning Guide. Better safe than sorry. Linda
Hi Paula, canning meat is actually easy. I only learned to can meat when I took my Master Canning and Preserving 12 weeks of classes. I had been canning for at least 50 years but food has changed and so have some canning techniques. The Ball book is a good one. I can’t imagine the shock of seeing $300 for two slabs of pork ribs!!! YIKES! We are eating less of everything, and meat is at the top. Linda
Grow a garden. That will save considerably on food.
Hi Janet, I totally agree. It saves me so much money! Great reminder! Linda
Oh, I forgot to mention about the price of fertilizer. We got a bill from the co-op last month and the price has doubled. It wasn’t cheap to start with and now it’s even more. I’m talking about thousands of dollars and we don’t make that kind of money off our wheat! I’m wondering how much longer we will be able to do this.
Hi Paula, oh man that is terrible! I have heard the prices have gone up but we (the public) never really see the dollar amount. Something has got to give. Linda
Several of your suggestions have been our way of life for decades. We carry no debt, and have been mortgage free for 30 years. We have bought used, and shopped garage sales since we started. Saving and stocking up are our way of life. We always stocked up for 6 months, you have taught me to push for beyond one year. I love Matt’s buy it cheap and stack it deep. The only place I might disagree, is putting off clothing and shoe purchases. Prices will only go up, so if you can find a really great sale on quality items, and you have the funds, I would go for it. God Bless us and keep us safe.
Hi Chris, I buy clothes that are on clearance racks. I still buy clothes and shoes. The difference is that you and I look for bargains not necessarily the newest for ego purposes. I could be wrong, I want to look acceptable. I wear very little jewelry, I think it all depends on the end goal. You and I chose to get out of debt by whatever means. I drive a 2009 Honda CRV with 4WD. I don’t need a new car to satisfy my ego. I love new cars, don’t get me wrong. Is it my age, I no longer carpool so for the last 13 years we have used one car. It works for us. It may not work for others. I love a new shiny car or truck, but I do not want to pay for one. I turned 72 years old this year. I do not want a house payment or any debt. When I was working I stocked up BIG time with freeze-dried food. Not now, the prices are ridiculous. I have plenty. Now it’s cases of cans and buckets or rice, beans, etc. I sleep at night knowing I’m prepared. I will never feel totally prepared but I feel good, that’s how I roll. We can do this Chris! Linda
I grew up poor so this is just same old same old. When I was a kid we got free lunch oh the other kids were nasty about that! But living poor prepared me to prepare! My Husband and I started prepping in 2000. In 2008 Doug was layed off, our preps kept us alive for 9 long months….I’m glad we had them and just as glad we had to find out what did and didn’t taste good!
Hi Hazel, my husband and I grew up poor as well. They didn’t have free lunch back then. Now they have breakfast and lunch for those less fortunate. Hopefully, it’s discreet so other kids are not aware. That makes me sad that other kids were nasty about it. THat’s not right. Anyway, it’s a blessing you put food away and it kept you alive for 9 long months. It’s actually a blessing in some ways because you learned how to do it and what you would not buy going forward. Thanks for sharing your great story, Linda
I am so glad that you said you never feel totally prepared. I have felt that way too. I always question myself on
things, Do have enough of this or that and if not how much more do I need to feel “safe”.
I did get out my books that I mentioned before about how people lived and what they ate growing up during the
depression. As I read these stories I think people in today’s world would probably die before they eat like they did
back then, but you eat what you have and stealing is NOT the way to go. Stock up like everyone else. grow your
own food. I had a friend who lived in a apartment with No balcony so he put a table in front of the window and
put some plants on it to grow even a little of his own food. I am still working on planting in buckets and flower
pots since I can no longer bend to plant in a real garden in my yard. I am disabled but I am not giving up growing even a little of my own food.
Hi June, great comment! You and I know how to cook from scratch so we will be able to survive with less. The older we get the harder it is to bend over to work in the garden. I get it. Since our move up north I will be investing in taller garden boxes. The last ones were 18-inches tall. I would like 24-inches, hopefully, I can find some. Whatever we can grow the better off we will be however little it may be. We can only do what we can do. Linda
I was reminded in your section on OTC meds and first aid supplies to suggest people be sure they know all the benefits in their health insurance. We just received an OTC catalog from our Medicare supplemental insurance. We are eligible for $150.00 a year each for first aid supplies, tooth paste, vitamins and supplements. It’s not a fortune, but I’ll take it!! Over the past two years we alo got about $400. each in gift cards for things we were already doing, like routine check ups and blood work. It pays to make sure you are receiving all you are entitled to
Hi Chris, oh my gosh, great comment! We just ordered our health insurance supplement second set that we are able to get quarterly!! The best thing this time was an Oximeter! I have one but felt strongly to get another with all the people around me that have been sick. You’re so right it’s not a fortune, but every little bit helps. Linda
Linda,
According to those I know who have lived through hyperinflation in places like Argentina or Zimbabwe the ability to grow and preserve your own food are the most important skills you can have. Food, water, TP, medicine, ammunition–all of these things are commodities and stocking up on them before hyperinflation hits is the best insurance against it. Cash becomes worthless and while gold holds its value you can’t eat gold and because of that it’s hard to barter with it.
Hyperinflation also leads to civil disorder as desperate people start doing things they normally wouldn’t do in order to stay alive. Rioting, looting, chaos and anarchy–name your worst nightmare and that is what hyperinflation can lead to.
In the past, countries that suffered from hyperinflation either went to war (Germany) or were bailed out by other countries and international aid organizations. But who would, or even could, bail us out? We should all pray it doesn’t happen here.
Hi Ray, great comment! I LOVE LOVE LOVE IT! I totally agree. I had a friend email me the other day and ask me how much money she should have on hand and what size bills. I told her small bills, but they may be worthless. I said your best bet is to stock up on food. And lots of it. You’re so right gold and silver will hold their value, but they won’t feed your family. God help us all, we must all pray to our own God or to the Universe to help our country, whatever faith we are. Things are going to get worse. Linda
MANY empty shelves today at the Walmart where I shop. I have never seen it this bad. I was able to buy what I needed which was some dairy and fresh produce but it was depressing walking up and down many of the aisles.
Hi Paula, oh, wow, I’m glad you were able to get some dairy and fresh produce. I am seeing so many empty shelves as well. I have to agree, it is a bit depressing looking at shelves we never thought would be this sparce. Thanks for the update! Linda
I learned a lot from this post, Linda. So I wish to thank you. It will help me be better prepared. Being FRUGAL is important. I have a used car that’s paid for. Slowly, steadily working on paying off my house. I’m taking your advice and paying off a small credit debt I have.
I like the idea of finding a way to have a side job or an extra income!
Again, thank you for teaching us!!
Hi Janet, aww, thank you so much for your kind words! When you pay off that small credit card debt it will be so awesome. We can sleep at night knowing we will survive one way or another. You and I are very frugal, and that’s so important. Cooking from scratch is a skill that will save our lives one meal at a time. Keep up the good job! Linda
For anyone looking to reduce their mortgage, look online or contact your mortgage company for an amitorization schedule. This will give you a total breakdown of every payment, and maybe allow you to see that skipping one pizza a month, can get you started on the road to financial freedom.
Hi Chris, great comment! So true!!! I had my own mortgage company for almost 20 years, and always gave amortization to my clients to help them pay off the loan! Good tip! Linda
Linda, and all who read this blog!!
I think, for me, the most difficult thing is that I am on a fixed income that will not go up with the economy. I am stuck! So, I don’t carry debt, but I do like fresh food (meat, eggs, cheese, fruits and veggies). Since the price of meat and cheese has risen so much since the start of the pandemic, I have cut back to very little meat and when I do splurge on meat, I make it the side dish instead of the standard American main dish. I can still get fruits and veggies at reasonable prices but that, too, is rationed on my plate!!
I have not had to dive into my food storage other than simple rotation but haven’t touched my long term storage yet. With the looks of the grocery store shelves, though, it might just become a thing in my home! But, that is what my storage is for – the lean/rough times!!
Hi Leanne, I hear you on the fixed income! Mark and I are eating very little meat. If we do it’s because I’m writing a post about it with the recipe! Yes, indeed that’s why we have our long-term food storage, it’s for lean and rough times. The good thing is that we know how to cook from scratch! I need to look for a Farmer’s Market where I live now this coming summer. I hope I’m wrong, but I believe things are going to get worse. We will get through it. We can do this. Linda
One thing never mentioned on any prep site other than the usual situations is Inflation…..which is where we are now. I deal with it by using my food storage….which I have always done. I buy only produce and my soy milk so this week I spent only $28, We have a good income so when canned or boxed items are on a good sale, I have started to ask if I can buy a case at the sale price…..much easier to store a case of veggies for example than a few loose cans. I am now using up the loose cans or my food storage veggies and fruits. There are only us 2 seniors so cook a lot from scratch but do like to eat out at times but no fast foods….good healthy foods so that is why we like buffets a lot where were we can chose what we eat. When I checked out the gal in front of me had a bill of $311 and her cart was not even over flowing. The gal behind me had 6 or 8 items….all unhealthy stuff!!!! I do not buy bottled water, junk foods or sugary drinks…..am a very healthy 83 yr old. I prefer to have a good quality of life rather than eat all that junk foods….I do eat some at pot lucks but haven’t had soda in our house for many many years. Hubby decided recently to stop with ice cream but does love his chocolate Snickers. When we cut out most of the unhealthy foods and drinks, we can manage to deal with inflation.
Hi Sandra, great comment, I totally agree with you, buy cases when the cans or boxes are on sale. I honestly do not know how families are able to feed their families because of the price of food. I love Snickers, LOL! I pick those out at Halloween! Love it! We do not buy bottled water except to donate a case or two to the local school food banks. We only donate healthy granola bars because we hope the kids in need will have some healthy high protein bars with the water. You are doing everything right, good job! Linda