Earlier this month, Kelsey Benson was laid off from her position in sales. That termination has brought a fresh financial burden — a medication bill that abruptly rose from $120 a month to $500. She resides in Queens, New York, and her health insurance disappeared alongside the job.
Benson, 32, said that the added cost came on top of rising rent and utility expenses. The pressure, she said, has made it harder for her and her partner to plan for buying a home and having children.
“You should not have to wear yourself down to nothing to be able to live,” Benson said.
The Iran War’s Price Wave
Benson does not stand alone. The rise in prices began with the Iran war and has continued for months, pushing up the cost of gasoline, groceries and other goods across the country, which has tightened household budgets for many families.
Across the nation, consumers are feeling the weight of financial pressure, and the statistics paint a sobering picture.
- Gas prices jumped 50% since the war broke out, with the average gallon of gas at $4.47, according to AAA.
- Grocery prices have increased more than 20% over the last five years, per U.S. Bureau of Labor Statistics data.
- Inflation stood at an annual rate of 3.4% in August, the most recent month on record, according to federal government data.
What Shoppers Expect Next
A recent University of Michigan survey shows that shoppers expect inflation to increase further over the coming year. The survey also found that individuals’ view of their own financial situation has declined.
Borrowing costs were hit hard by the cost crunch. A key long-term Treasury rate reached its highest level in nearly two decades earlier this month, even before the Federal Reserve raised its own benchmark borrowing costs. The result was a push upward on rates for credit cards and mortgages.
Ted Rossman’s Warning
According to Ted Rossman, a financial analyst at nonprofit advisory firm Money Management International, Americans have already made deep cuts to their spending.
“A lot of people across America have cut the expenses that they can cut,” Rossman said. “They feel like they can’t catch a break.”
Rossman noted that the accumulated toll is stacking up.
He said “People are feeling what’s happened the last several years,” and then went on to say “The accumulated toll is really stacking up.”.
Grocery Shoppers Adjust
The recent price surge has not escaped law students’ attention, and one of them, Drew Davis, 26, pointed to a shopping trip this summer as the moment he first noticed the shift.
Three years after starting law school, he observed that the costs of his favored cuts of beef and chicken had risen $1 or $2.
“I’ll buy, like, fattier beef, or I’ll buy chicken instead of beef mostly, just because it’s cheaper a lot of the time,” Davis said.
Student loans are how Davis pays for school, and he says they shape how he spends money on housing and purchases. When describing the present economy, he used the phrase “intense.”.
Steve Prentice’s Bargain Hunt
Tennessee resident Steve Prentice, 70, who now works part-time at a yarn store after retiring, says gas has risen the most.
“This is the first time I can recall gas being above $4 [a gallon],” Prentice said.
The cost crunch prompted Prentice and his wife to seek out bargains on groceries. Prices at all of the chain supermarkets nearby have “generally gone up,” Prentice said, forcing him and his wife to turn to lower-priced stores.
“Their prices seem a little bit more stable, but even they have gone up,” Prentice said.
The Dream Is Not Attainable
Many people feel that the American dream of owning a home and building a family is beyond their grasp, and Benson’s anger comes from seeing that reality.
“The dream, many people have been told, is you get the white picket fence, the house,” Benson said. “It’s not attainable.”
The cost of her medication, her job loss and the general pressure on family finances have driven her and her partner to make tough decisions about the future they had planned together.
Source material: “'Can't catch a break': Shoppers squeezed by surging inflation and higher interest rates,” ABC13 Houston.
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