Consumers feel the pinch of rising costs, from groceries to the gas pump.
Nearly 9 in 10 U.S. adults say they’re paying higher prices on everyday expenses in 2021, according to a new survey conducted by YouGov for personal finance site Bankrate. A July 2021 report from the Bureau of Labor Statistics also showed a spike in overall costs, with a 5.4 percent rise in food, gas and utilities, transportation, medical care, housing and new and used cars and trucks.
So, who’s getting hit the hardest by the high cost of consumer goods and services due to the COVID-19 pandemic, and how are they finding ways to cope with today’s high cost of living? Here’s a breakdown of who’s groaning at the checkout line or breaking into a sweat paying utility bills and other expenses each month.
Baby boomers and Gen Xers hit the hardest
Around 9 in 10 baby boomers (age 57 to 75) and 92 percent of Gen Xers (age 41 to 56) reported paying higher prices in 2021, according to the Bankrate survey. But the survey also found that baby boomers were “more likely” to notice price increases than younger consumers.
For example, 89 percent of boomers and 79 percent of Gen Xers reported paying more at the grocery store, while only 40 percent of Gen Zers (age 18 to 24) reported paying more for groceries. The age disparity in reporting rising grocery prices could be due to perception, with older consumers simply paying more attention than younger generations to how much money they spend at the checkout line, according to Bankrate.
Higher costs creating financial troubles for many
Nearly two-thirds of consumers surveyed say that rising prices have had a negative impact on their personal finance situations, according to the Bankrate survey. Once again, the survey found generational differences in those who noticed their financial situations being impacted negatively, with baby boomers (75 percent) and Gen Xers (70 percent) reporting more problems getting by due to rising costs.
Baby boomers may be more likely to notice a negative impact on their financial situation because they could be retired or saving for retirement, according to Bankrate. Meanwhile, younger generations are more likely to expect a higher salary down the road to help them better afford higher prices for consumer goods and services.
Consumers racking up debt just to get by
Around 20 percent of Americans told Bankrate that they’ve racked up credit card debt or debt for loans from friends or family, thanks to rising prices and overall costs of expenses and consumer goods. On top of that, nearly one-fifth (19 percent) of those surveyed say they’ve also paid credit card fees in 2021 for using their credit cards.
Middle-income households feeling the pinch
Households in the $40,000 to $80,000 annual earnings range felt the price squeeze more than those who pulled in a higher income, according to the Bankrate survey. Households earning $40,000 to $79,000 reported the most negative impact on their financial situation. Around 64 percent of those making less than $40,000 a year noticed a negative impact. Higher-income households earning at least $80,000 noticed an impact, too, with 58 percent reporting a negative impact to their personal finance situation due to rising costs.
Consumers finding ways to cope
Americans are making changes to their earnings and spending habits to cope with rising prices, according to the Bankrate survey. Nearly half (45 percent) avoid or hold off on certain types of purchases or cut expenses in other areas (47 percent) to afford purchases. Around 38 percent make an effort to shop sales and look for other discounts, and 22 percent dipped into savings to cover expenses. One in five are trying to increase their income so they can better afford skyrocketing pandemic prices across the board.
Published by Debt.com, LLC