Tough economic times, lower inflation and scaling back? Is it easing your bank balance any?

With the economic climate as it is, the majority of us are watching what we spend, and some of us in particular are being a lot less extravagant. So, are we actually saving on staple items such as electricity, petrol and food now that we are in this recession? Does anyone know if prices are actually going up or down?

As announced recently, inflation (as measured by the Retail Price Index) remains negative at -1.2%. The inflation rate became negative for the first time in almost 50 years last month, while the Consumer Price Index remains well above the UK government’s target of 2%.

The question is: how does this affect you and me?

Our personal rate of inflation depends on how we spend our money and actually may not match the official rate of inflation according to a report yesterday by the BBC. And in fact, ‘the news’ isn’t always a reality for some of us.

The BBC has an online calculator available so we can get a much more accurate picture of how inflation is actually affecting us as individuals. Worth checking this out – especially for me, after purchasing my new Mini!

Using this cute wee calculator and filling in my monthly expenditure, annual spending and housing costs I was able to find out how my bank balance has changed with the economic times. Apparently my cost of living has changed by 0%. Safe to say that’s obvious when I look at my month-end bank balance!

So very little difference at my end… For now! But I’m still hopeful with ‘the news’ today that I might soon be making some big savings.