Abbey Walter said he began to notice grocery bills creeping up earlier this year. Prior to January, Maryland residents typically spent about $ 75 a week on groceries. Currently, her bill is on average over $ 150.
Part of that increase may be due to a change in where Walter buys groceries. Due to the move, she and her partner stopped shopping at a discount market near her former home. Still, she noticed that prices were generally rising — and rising. According to Walter, produce, eggs, meat and bread were all more expensive than before. It makes them rethink their budget.
“That means we can’t buy a lot of the more fun we want,” said Walter, a 29-year-old wildlife biologist. “We probably won’t travel that much, we’ll be back in the office soon, but we probably won’t buy clothes.”
Like Walter, other Americans are experiencing the reality of higher inflationary dollars and cents. Consumer prices rose 0.6% in May, pushing annual inflation to 5% in the last 12 months.Ministry of Labor Said Thursday. This represents the fastest growth rate since August 2008 and reflects the impact of the sharp increase in demand as consumers resume eating, shopping and traveling as the economy resumes.
Some food manufacturers and grocery stores say ““To meet shoppers’ expectations, we pack food in small containers while charging the same amount. And it’s not just grocery prices that are rising. Used car prices are over 7% last month. Soaring, furniture and airfares have also risen to Morgan Stanley.
“The summer vacation may be expensive,” Greg McBride, chief financial analyst at Bankrate, said in an email statement. “Airfares have risen 7% compared to a month ago, and car and truck rental prices have more than doubled in the last 12 months. These trends will ease as online capacity increases. But anyone can still guess when that happens. ”
Inflation is gaining momentum due to rising consumer demand and bottlenecks in some industries.Timber has tripled in price in the meantime Coronavirus pandemicAdded, following a slowdown in some factories during the crisis To the cost of a new home and the increased cost of even a simple home renovation.
Indeed, many economists believe inflation will ease later this year as supply catches up with demand in grocery aisles and other stores and markets. But until then, consumers may feel a pinch in their notebooks.
The pain can be more severe for households that are still recovering from the pandemic and for households with fixed interest rates, such as the elderly who rely on social security for most of their income.
According to the Center on Budget and Policy Priorities, a quarter of Americans struggled to pay their household expenses last week. analysis Census data from early May. Data also show that about one in ten adults, or 19 million, struggle to provide enough food for their families to eat within the last seven days.
Elderly people, on the other hand, have not kept up with the sharp rise in costs and living costs for at least 2021. The Social Security Administration, which adjusts payments every fall of the following year, increased payments in 2021 by 1.3%. .. This means that social security checks haven’t caught up with the price increase that hits this year’s wallet.
“What we are working on right now is that older people receive 1.3%. [cost of living adjustment] In 2021, these rising costs are currently occurring and are very poorly prepared for this type of inflation, “said Mary Regionson, a policy analyst at the Elderly Federation.
According to May, this was after the purchasing power of social security payments declined by 30% since 2000. Research From the Elderly League. If inflation continues to skyrocket, it could be further eroded, the report warned. About a quarter of the more than 60 million older people who collect social security depend on payments for 90% of their income, the group says.
“For every $ 100 a household that retired in 2000, that household today can only buy the same goods and services worth about $ 70,” the report said.
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Johnson and other experts say next year’s cost of living adjustments for social security could range from 3% to 5%, depending on what happens with inflation in the coming months until fall. Predicting that, there will be some relief in 2022. But until then, consumers may need to postpone their purchases or look for cheaper alternatives.
“We are experiencing an era of madness and prices will bounce significantly until things boil down,” said Alicia Munnell, an economist and director of the Center for Retirement Research at Boston University.
The household budget was already tight. Then inflation happened.
Source link The household budget was already tight. Then inflation happened.