) -- If it feels like you're barely able to keep up with the rising costs of food, clothes, appliances, toys,


-- you're not alone.

While the consumer price index

ticked down 0.2% in June

, the result of a welcome 6.8% drop in gas prices, the index for all items excluding food and energy (which are subject to the most volatility) continued its steady climb, edging up 0.3% for the second straight month.

Inflation has pushed up overall prices 11.3% in the last 5 years, meaning the same camera, pair of shoes or concert tickets you paid $100 for in 2006 would cost almost $112 today, according to the U.S. Bureau of Labor Statistics (BLS).

A trip to New Orleans taken a few years ago was probably worth every penny in today's dollars -- maybe even more.

And finding that extra 12 bucks hasn't been easy for most. More than 14 million U.S. workers can't find a job, and even those employees who were fortunate enough to receive incremental raises over the past few years are just treading water: Average weekly wages, when adjusted for inflation, have increased just 1.4% since June 2006 and have actually fallen 1.4% in the last year, the BLS reported this month. Figures from the past thirty years reveal the same discouraging trend: Real weekly wages have increased just 2.1% since 1981 among non-supervisory and production employees, for which the BLS has more historical data.

Now, don't go storming into your boss's office just yet. This is partly due to the skyrocketing cost of health insurance, which has risen more than 20% in just the last five years. It's actually costing your employer more than ever to keep you on payroll -- you're just not seeing much of that increase in your take-home pay.

So it's no wonder we're all trying to outrace inflation. The desire to protect our wealth from this constant force of erosion is at the heart of almost every financial decision we make, whether it's keeping money in safe havens like CDs and Treasurys or pursuing bigger, riskier gains elsewhere. But there might be a simple way to beat inflation every time, to extract the full value from at least some of your hard-earned dollars: spend your money, while you have it, on making some memories.

"Rosy Retrospection"

Certainly, MasterCard (MA) - Get Report has made a point of reminding us that memories can be 'priceless.' But there may be more to that idea than simple Madison Avenue schlock.

When I think about my first trip to New Orleans 10 years ago, I instantly feel good. I remember the food -- the plump oysters, flavorful gumbo and crawfish etouffee - the easy strolls through the French Quarter and the wandering trumpet notes that seemed to follow me around the city.

But I don't remember what the flight was like. The sunburn I got late in the trip is an afterthought. And though our rental car was broken into one night, and we had to get the window replaced at a sketchy glass shop on the edge of town, I remember it fondly for some reason, like an adventure.

You've no doubt experienced this yourself: your memory of an event has a fuzzy glow to it, a nostalgic, better-than-the-real-thing quality. Some psychologists refer to this phenomenon as "rosy retrospection."

A 1997 study published in the

Journal of Experimental Social Psychology

evaluated three groups of people before, during and after vacations to see how their expectations and recollections aligned with their actual experiences. "The results ... supported the hypothesis that people's expectations of personal events are more positive than their actual experience during the event itself, and their subsequent recollection of that event is more positive than the actual experience," the researchers found.

As anyone who has eagerly awaited a sunny vacation during the dark depths of February can tell you, we tend to place impossibly high expectations on an upcoming trip or event. But we do the same thing in retrospect as well.

It's almost like our memories are adjusting for inflation.

It's All About the Story

What's really happening is that your mind is constructing a narrative to resolve the discrepancies between your positive expectations -- your office daydreams of drinking margaritas on a sandy beach -- and the distractions and disappointments of the reality -- the days spent locked in a bathroom suffering from la turista.

"People understand their life events by constructing narratives or stories about them," say the study's authors. When the plot doesn't play out quite like we planned, "we strive for consistency in memories by revising our recollections of how we felt in the past."

Your mind, like any practiced book-cooker, doesn't let facts get in the way of a good story, and makes a few adjustments to ensure it all adds up.

And the mind's fuzzy math can rival that of the most unscrupulous accountants. In one of the study's experiments, students were questioned at various points before, during and after a three-week bicycle tour. On Days 5 and 13 of the trip, the average level of enjoyment reported by the students was at its lowest, at 0.20. In both evaluations conducted after the tour (one week and one month later), students' recollections of their own enjoyment during the trip had risen to an average level of 0.26. That's a 30% increase.

A Life Well Lived Is Money Well Spent

Not many bond funds are going to give you a 30% return in just a few weeks.

What's more, while money under your mattress is almost certain to lose value, there's no guarantee that stocks, gold or even government bonds won't do the same, wiping out all your gains and more. Memories, on the other hand, aren't subject to market crashes.

Think about it personally, and the inflated value of your best memories becomes even clearer. How much would you pay to be back in college, at your favorite bar, coffee shop or pizza joint, for one night? Or to relive your first kiss with your spouse? Or to be back in the stands at a surprisingly historic baseball or football game? Probably far, far more than it cost you at the time.

My trip to New Orleans set me back about $1,000. In today's dollars, it would cost about $1,275, according to the BLS inflation calculator -- an increase of 27.5%. Based on the findings of the above experiment, my memory may have actually kept up with inflation.

But thinking about that trip now, it was worth more than $1,275. Maybe as much as $2,000. Why? Because it was my first time in that marvelous city, which hadn't yet been wounded by Hurricane Katrina, and I was young enough to stay out all night making the most of it.

Playwright Neil Simon sums it up best in "Biloxi Blues," when his alter-ego, Eugene, reminisces about boot camp:

"As I look back now, a lot of years later, I realize my time in the army was the happiest time of my life. God knows not because I liked the army, and there sure was nothing to like about a war. I liked it for the most selfish reason of all. Because I was young. We all were. Even Selridge, Toomey, Wykowski ... I didn't really like most of those guys back then. But today I love every one of them. Life is weird, you know."

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