Inflation may be the other shoe. In March, inflation surprised economists by rising to 3.3%—a 2.5-year peak—significantly above the projected 2.8%, with no sign of slowing.

When inflation starts a relentless climb, the steady increase in the cost of living may push too many property owners and wanna-bees over the financial line, and threaten living standards. The reported "signs of recovery from the recession" are not enough to move everyone out from under high-stress pressures of job and financial loss. Add inflation and that’s two shoes dropped.

Inflation means less. Less discretionary spending. Less money left after buying the basics. Less money to service debt and mortgages. Prolonged inflation can affect job markets, pay increases, and small business revenues.

Prices on most commodities are on the rise. Energy costs have risen by more than 10% since last April. Gold, silver, and cotton are at peak prices. Real estate values continue the climb. Even with government inflation statistics ("core inflation") that eliminate highly-volatile costs like food and energy, consumer purchasing power is revealed to be continually eroded.

Since inflation is usually managed by increasing interest rates, consumers may feel the crunch on another front soon. Some financial pundits see the beginning of a trend in the March inflation peak. But it’s wait and see since other experts believe inflation may recede once current oil pressures subside.

There’s not much consumers can do to beat inflation since they can’t stock pile food and gas. Families can prepare for inflation’s price storm by improving their ability to spend less than earned.

What Can You Do To Cushion Inflation?

• Only spend cash. If you don't have any to spend, seriously question every purchase before you hit the cards.
• Attack debt. Use everything from the take-out and eat-out money to that for the stream of want-not-need purchases that build debt. Review credit-card bills to discover where the money went, so patterns can be changed. Credit counselling agencies are there to help you carve out a budget and carve down debt, so contact a nonprofit agency for discrete backup.
• Real estate buyers may decide to concentrate on established-value neighbourhoods and condominium buildings which historically remain stable when markets slide. Buy based on one salary, or one-and-a-half, instead of stretching to the max.
• Boomers deciding how to spend inheritances-real and anticipated-would benefit from professional advice on what degree of real estate leverage will enable them to renovate and to invest wisely to hedge inflation.
• Bulk buying and co-operatives can offer savings, but be sure to stick to a shopping list for the greatest benefit.
• Keep home and cottage well-maintained, so inflated future repairs will be kept to a minimum.
• Pay less taxes. Does income tax season end on May 2 with you sure that you have taken advantage of all tax credits and advantages available to you? Challenge property-tax assessments to ensure the lowest possible realty tax bill.
• One solution to more income and less taxes could be a home-based business, which carries with it many income tax advantages.

Cushioning the impact of inflation may involve stepping outside the lifestyle box crafted in pre-recession years. Be aware that if you just set recovery from the recession as your financial goal, inflation may blind-side you.