HONOLULU (KHON2) — Inflation continues to rise, with some Hawaii residents not being able to keep up.
Everyday expenses like food and gas are reaching an all-time high despite working wages not keeping up with demand.
Hawaii’s minimum wage is currently $10.10 and has not changed since 2018. Meaning those working a minimum wage job with no overtime are barely making $21,000 in Hawaii.
Legislation is currently getting signed to gradually increase the minimum wage in Hawaii. However, it is not happening overnight. A bill was passed in May to increase minimum wage in Hawaii to $18 by 2028.
Getting out of the cycle of living paycheck to paycheck doesn’t happen overnight. In fact, it can take weeks if not months to save and change one’s spending habits.
Jasmyn Keala Nakata with Milestone Wealth Management said they offer tips for people who want to stop living paycheck to paycheck and get a handle on their finances again.
“Some of the tips that I have is to look at your local Midweek, or if you’re on Hawaii island check your local KTA store booklet for monthly savings on various food products,” said Nakata.
She said using coupons and savings can really pay off in the long run. Something that might not seem like an easy switch to make but can save you thousands of dollars is eating more at home rather than buying out.
“Once you’ve satisfied your monthly grocery list, eating a home cooked meal or doing meal prep at home for you to take a home cooked meal for lunch can save you hundreds, and if not thousands of dollars in a year just by taking that extra time to prepare your meals ahead of time and it can usually be a much healthier option,” said Nakata.
However, according to a report by U.S. Department of Agriculture low-income households tend to spend less of their income on food. They report U.S. households with higher incomes spend more money on food, but the amount spent represents a smaller overall portion of their budgets.
In 2020, households in the lowest income quintile spent an average of $4,099 on food (representing 27 percent of income), while households in the highest income quintile spent an average of $12,245 on food (representing 7 percent of income).
So even cutting back on eating out won’t always be enough to stop living paycheck to paycheck. Nakata said cutting back on unnecessary trips can help save more money in the long run.
“Another option is you can drive vehicles that will use less gas, or even consider an electric vehicle as a daily commuter option,” said Nakata. “With the skyrocketing of gas prices lately it can be very costly to fill up that large gas guzzler so considering commuting in a more gas efficient vehicle might be a smarter financial option.”
She said it’s best to stick within a budget and consider the things you need. For example, things like food, gas, daycare and hobbies are all essential. However, things like shopping, gambling, vacationing and dining out are fun but not always needed.
“This is probably the hardest most difficult thing for most people, and it takes a lot of discipline but once you get in the habit of only buying what you need it becomes a lot easier to buy things that you don’t need, and you will be much happier and proud of yourself for making good decisions for yourself,” said Nakata.
She said believing that you can start saving and stop the cycle of living paycheck to paycheck is the first step and conquering financial goals is a great feeling.
“Believing that you are enough and have enough when you can satisfy your basic needs is so important on your financial journey,“ said Nakata.
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For more financial tips from Nakata head to Milestone Wealth Management’s website.