These days, it is almost impossible to avoid conversations about falling revenues, rising living costs and soaring inflation. You hear them in grocery queues, on public transport and in workplaces. Wherever people gather, the cost of living has become the background noise of daily life.
The most important point to remember is that the financial pressure many people are experiencing is not necessarily the result of personal failure. It is part of a wider economic reality. When people complain that their income is falling while the cost of living is rising, they are describing the same painful reality: their purchasing power is shrinking.
Some may use these concerns to express frustration or mobilise public opinion. That is understandable. Government intervention can also be justified when prices rise suddenly and sharply. Governments have a responsibility to prevent abuse, curb excessive price increases, protect consumers and preserve social stability.
However, even when official inflation figures begin to decline after government action, the situation experienced by households may not improve immediately. Lower inflation does not mean prices return to their previous levels. It only means that prices are rising more slowly than before.
Prices are often sticky. Once they rise, they tend to remain high. Households and businesses must then manage permanently higher costs, even when inflation moderates. This is why people may continue to feel the effects of inflation long after official figures show an improvement.
Our minds also remember earlier prices. Every time we pay more for food, transport, rent, medicine or school supplies, we compare the new price with what we used to pay. Each transaction can therefore feel like a loss. This price-level shock affects nearly everyone, from low-income households to large companies.
Inflation does not only change prices; it changes behaviour. When income does not keep pace with expenses, households begin to reduce non-essential spending. People switch to cheaper brands, postpone major purchases, reduce entertainment spending and focus on necessities.
This is a rational response to financial pressure. But when many households reduce spending at the same time, the effect spreads through the economy. Businesses experience lower sales, revenues fall, and employers may respond by slowing recruitment, cutting bonuses, reducing salary increases or, in more severe cases, laying off workers.
Everything is connected. When consumers spend less, businesses earn less. When businesses earn less, workers face greater uncertainty. This creates a cycle in which anxiety about the future encourages further reductions in spending.
The gap between slow-moving incomes and permanently higher prices creates deep financial and psychological stress. It is normal for people to feel tired, worried or frustrated when they are being squeezed from multiple directions. Recognising that reality is important. But recognition alone is not enough. The next step is to change behaviour.
In a high-inflation environment, relying on willpower is rarely sufficient. What people need are systems that make better financial decisions easier and more consistent. As the saying goes, it is not only your salary that determines your financial security; your spending habits matter as well.
The first step is to rebuild the household budget. An old financial plan may no longer work when food, rent, transport and other essentials have become more expensive. Families should review their expenses honestly, identify unnecessary costs and set new priorities.
This does not mean eliminating every small pleasure from life. It means distinguishing between needs and wants, particularly during a period of financial uncertainty. Creating even a small cash cushion can provide important peace of mind when income is irregular, business revenue is declining or jobs are uncertain.
It is also important to review fixed costs. Housing, transportation and food are usually the largest expenses in a household budget. Finding practical ways to reduce these costs can have a much greater impact than becoming overly focused on every small daily purchase.
For example, households may consider sharing transport where possible, planning grocery purchases, reducing food waste, comparing prices before buying, and avoiding unnecessary debt. Small leaks may appear harmless, but they can become serious over time. As the saying goes, a continuous small leak can eventually sink a great ship.
At the same time, inflation makes it important to explore ways of increasing income. Waiting for a salary increase may not be enough when prices rise faster than wages. People should consider how their existing skills could generate additional income through freelance work, consulting, small businesses, teaching, digital services or other side opportunities.
The objective is not to exhaust oneself by working endlessly. It is to create a measure of resilience. A second income stream, even if modest, can help households cope with emergencies and prevent them from relying heavily on expensive borrowing.
Saving should also become more systematic. Setting aside a fixed percentage of income immediately after receiving a salary or payment can help establish discipline. Even a small amount placed in a savings or investment account can make a difference when unexpected expenses arise.
High-pressure economic periods also create ideal conditions for fraudsters. When people are worried about money, they are more likely to be attracted by offers that promise quick profits, huge discounts or easy solutions.
Consumers should be cautious of “VIP-only” deals, “last chance” promotions, fake sales, limited-time offers and pressure to pay immediately. Such tactics are often designed to bypass careful thinking and push people into impulsive decisions.
Scams now spread easily through social media, messaging applications, SMS campaigns and online advertisements. They may appear professional and legitimate, making them difficult to distinguish from genuine businesses. During holiday seasons and the New Year period, these tactics often become more common.
Before making a major non-essential purchase, it is wise to pause. Give yourself a day or two to think. Compare prices, verify the seller, ask whether the purchase is truly necessary and avoid making decisions based on sudden emotion or fear of missing out.
There is an Ethiopian proverb that offers comfort during difficult times: “Kale fetari amuatesh gagri.” It roughly means, “Since the Creator has not abandoned us, do not lose courage.”
The proverb does not suggest that people should ignore hardship. Rather, it encourages resilience, patience and wise action when circumstances are beyond one’s control.
Inflation requires neither carelessness nor panic. It requires discipline, awareness and practical judgment. Depending entirely on government intervention may offer temporary relief, but it cannot replace sound financial management at the household and business level.
The background noise of inflation may not disappear quickly. Prices may remain high, incomes may take time to improve, and the gap between what people remember paying and what they pay today may continue to cause frustration.
But this is not a personal failure. It is the structure of an economic shock.
The durable response is deliberate behavioural change: build saving habits, control unnecessary expenses, reduce high-cost debt, develop useful skills, search for additional income and treat overly attractive offers with caution.
Do not lose courage. A sensible budget, disciplined spending habits and careful financial decisions can help households weather difficult times. The economic pressure may continue, but a wise approach can help individuals and families cross the valley more safely.
