Photo: A shopper wears a protective mask at the Reading Terminal Market in Philadelphia, Feb. 16, 2022. (AP Photo/Matt Rourke)
U.S. households are spending $296 more a month compared to a year ago, and low-income households are feeling it worse than others.
Consumer prices rose 7.9 percent in February, year over year, according to the U.S. Department of Labor.
As inflation keeps rising, household costs will keep rising, according to a February report from economists at Moody’s Analytics.
“It is going to get worse before it gets better,” said Moody’s Analytics senior economist Ryan Sweet in a weekly market outlook report. “U.S. gasoline prices are set to rise further.”
Low- and middle-income U.S. households spent about 7 percent more in 2021 for the same products they bought in 2020 or in 2019, according to an analysis by the Penn Wharton Budget Model. Wealthy households, by comparison, saw their spending go up 6 percent, CNBC reported.
In a separate study, Wells Fargo showed the middle-class getting slammed by rising prices, CNBC reported. Inflation was 0.5 percent higher for middle-income consumers than the richest and poorest people in December, Wells Fargo economists found.
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U.S. consumers have apparently been saving money in anticipation of bad times. Moody’s reported that “household balance sheets in aggregate are in great shape” and that “consumers are sitting on $2.6 trillion in excess savings.”
Here are some ways to try and lessen the impact of inflation:
Reduce food waste: 40 percent of food waste happens in our kitchens. Eating leftovers and taking inventory before going shopping can save you money.
Food prep: Look up grocery store ads and create a meal plan for the week, incorporating items that are on sale, said Sahirenys Pierce, founder of personal finance blog Poised Finance Lifestyle. Prepare three of those meals on Sunday and have a plan for the remaining days to avoid buying fast food or takeout. “This strategy has helped my family save hundreds of dollars during our debt-free journey, the pandemic and now during times of high inflation,” Pierce said.
Buy frozen food: Advances in deep-freeze technology mean the quality of frozen food is just as good when thawed, and you can save 30-to-50 percent, CNET reported.
Private label goods, often found in the fresh food and pantry aisle, can save you 25-to-50 percent.
Fuel-saving programs: You can save 5-to-10 cents a gallon on gas by signing up online.
Find cheap gas: there are apps for that such as GasBuddy.
Pay cash for gas: Some fuel stations offer a small discount for cash.
Renegotiate your car insurance: if you’re driving less due to the pandemic, ask for an adjustment on your insurance premium.
Save on utilities and streaming bills: You can negotiate with your cable provider, streaming service and utility companies. Ask for customer retention and then ask how they can save you money. If you signed up for a streaming service because of a single show and now it’s over, cancel the service.
Photo: A shopper wears a protective mask at the Reading Terminal Market in Philadelphia, Feb. 16, 2022. (AP Photo/Matt Rourke)
