Inflation and the Projection of Circumstance

The elephant in the room for the last year has been inflation. If someone didn’t know what inflation was before, and certainly never talked about it during the course of their day-to-day life, that’s probably changed. Everyone now has thoughts and feelings about inflation. Inflation is everywhere. We see it when we go to the grocery store, when we put gasoline in our vehicles, when we go out to eat, when we purchase vehicles, and in pretty much every other area of life (well, except for Costco hot dogs and Arizona Iced Tea).

I’ve watched a certain phenomenon play out in many areas of life for years, especially as it pertains to work and money, and the recent inflation conversation has shined a spotlight on it. Everyone seems to have differing perspectives on inflation, and they vary wildly. Now one would think their perspective would be correlated to their education and/or area of expertise. However, that’s not the case. Their perspective is more closely tied to their own experience with inflation. In other words, they are projecting their own circumstances into the broader discussion.

As I see it, and as I walk alongside several families in my coaching, most people fit into one of three different groups when it comes to inflation:

1) Lots of Margin - These people had lots of margin in their financial life. Recent Inflation has reduced their margin but they haven’t had to sacrifice much. Their basic needs are easily met and they can still buy pretty much anything they want. Instead of going on three elaborate vacations this year, they may only do two.

2) Some Margin - These people had some margin in their financial life. Recent inflation has significantly reduced or eliminated their margin. The result of this is a profound alteration in their life. They have decreased or halted their saving/investing, given up some of their wants, or have become quite intentional with their basic needs.

3) Little-to-No Margin - These people had very little margin to begin with, if any, and are now being absolutely crushed. Just putting food on the table, gas in their car, and a roof over their head have become a constant battle. Second (or third) jobs and credit cards have become a means of survival.

These are the lenses through which people see and experience inflation. It makes a world of difference. This isn’t my attempt to condemn anyone or make people feel guilty. Rather, I want to shine a light on this idea of projection and perhaps we can be more empathetic to other people’s journeys. We need to see past our own circumstances if we hope to understand what others are going through. Or even better, if you’re in group #1, find ways to give a financial hand-up to someone in group #2 or #3. This is a season - a tough season - that we all just need to get through. And there’s no better way than to get through it together.