Suze Orman: Navigating Today's Economic Challenges - Cost of Living & Supply Issues

They're universal problems for sure.

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Key points

• Although the labor market is strong, living costs are up.
• Some common household goods are also getting hard to find.

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Today's economy is a strange one. On the one hand, jobs are abundant and wages have actually been on the rise. On the other hand, living costs are climbing at such a rapid pace that those growing wages can't keep up. It's no wonder, then, that so many people are struggling. 

Financial expert Suze Orman is well aware that consumers are having a hard time. On a recent podcast, Orman pointed to inflation and supply shortages as the two biggest problems consumers are dealing with today. 

And she's not wrong. In April, the Consumer Price Index, which measures changes in the cost of goods, rose 8.3% on an annual basis. And these days, everything from gas to groceries to utilities costs more. 

Meanwhile, many consumers are more than familiar with the supply chain shortages that have been wreaking havoc since last year. Most recently, parents all over the country have found themselves scrambling to get their hands on baby formula -- an absolute necessity for many families. And it's still extremely difficult to buy a car -- even if you're not all that picky about the model you get.

Unfortunately, it may be some time before inflation levels taper off and supply chains manage to catch up to consumer demand. And so it pays to take these steps in the near term to avoid struggling more than necessary.

1. Rethink your spending

When essential bills rise, cutting back can be difficult to impossible. But there may be a few expenses in your budget you can reduce your spending on, whether it's canceling a streaming service you can do without or forgoing social events that will eat up too much of your income.

Of course, it's not easy to cut out small luxuries like these. But if money has gotten tight and you don't have much in the way of savings to fall back on, you may have to make some short-term sacrifices to avoid driving yourself into unhealthy debt.

2. Boost your income with a second job

While living costs may be soaring, so is job growth. And that extends to the gig economy. These days, there are plenty of options for those looking to take on a side job, so do an assessment of your income-related needs and then aim to find a side gig that will allow you to meet them.

3. Stock up on essentials when they're available and the price is right

Nobody expected baby formula to disappear off the shelves to the degree it did. And that should serve as a wakeup call that we're not done with supply chain shortages. That's why now would be a good time to look at stocking up on certain essentials for your family, whether it's an over-the-counter medication you rely on or a specific soap or shampoo brand.

To be clear, this isn't to say you should panic and start hoarding every essential product under the sun. Rather, if you're particular about certain brands (whether due to allergies or another reason), then you may want to stockpile a little extra in case supply chains run low. 

Today's economic times are tough -- there's no question about it. But you can still do your part to get through this rocky period without hurting your finances in the process.