When people hear the word inflation, they often look at government figures like the Consumer Price Index (CPI) to understand how rising prices affect them. But for most individuals, those official numbers don’t tell the whole story. According to Registered Financial Planner Josefino Gomez, your personal inflation rate could be very different—and much higher—than what the CPI reports.
“There is no single measure of inflation for everyone,” Gomez told Financial Adviser PH. “The Consumer Price Index (CPI) is based on a fixed-weight basket of identified goods. It may be useful for a portion of the population, but maybe not for you.”
Gomez explained that people experience inflation differently based on their lifestyle and spending habits. For example, if your daily purchases include more imported goods or meat products like pork—which have experienced price hikes—your personal inflation rate is likely above average.
“If pork is expensive then you can alternate with chicken instead,” Gomez advised. “You may also decide to cut down on unnecessary expenses.”
This practical approach can help individuals take back control of their finances during inflationary periods. Rather than relying solely on generalized data, Gomez encourages people to look at their own spending and adjust accordingly. By tracking expenses and identifying which items have gone up the most, you can make smarter, more personalized choices.
He also stressed the importance of shifting habits to reduce the impact of inflation. Whether it’s substituting items, cutting luxuries, or rethinking how often you dine out, small changes can make a big difference.
Ultimately, Gomez believes that adapting your behavior to match your own financial reality is key. “We face our own inflation rate,” he emphasized.
So instead of feeling powerless when prices rise, take the time to understand your unique inflation footprint. The better you know it, the better you can beat it.
