Inflation 2023: Most Americans’ Paychecks Haven’t Kept Up
Written by
Nicole Spector
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
2022 was the Year of the Tiger — and also the year of record-breaking inflation. In June of 2022, consumer prices were up 9.1% year over year, making for the largest inflationary rate hike in 40 years. Though it has significantly cooled since then, Americans are still feeling the pains of inflation.
According to “New Reality Check: The Paycheck-To-Paycheck Report,” a recent research document from PYMNTS, about 9 out of 10 consumers say their incomes have not grown to keep pace with inflation. Only 14% of consumers say their earnings grew to match or exceed inflation. Because of inflation, 63% of consumers are living paycheck to paycheck.
Though you cannot control or impact inflation on a personal level, there are moves you can make to help cope with its effects.
Restructure Your Debt
According to Scotiabank, restructuring your debt is one way to cope with inflation. What does this mean? It can work in a couple of ways. You can switch to a lower interest-rate credit card (a smart move, regardless), and/or you can consolidate your debt, which entails moving all your credit card debt onto a new card for, ideally, a reduced annual interest rate. This is also helpful because it puts all your consumer debt in one place, making paying it off monthly somewhat less of a hassle.
Use the Right Credit Card
On the note of high interest credit card debt, you should — if relying on credit — use a card that offers points or rewards. This can help at the grocery store and at the gas pump, etc.
Shop for Groceries the Smart Way
You may already know a fair number of tricks to save on groceries, such as using coupon apps and shopping seasonally, but you can take your savings opportunities further by incorporating more affordable meals into your diet.
Budget food blogger Toni Okamoto told CNBC that he has five staple food items to buy when on a budget: canned chopped tomatoes or tomato sauce, beans, bouillon cubes, potatoes and onions. All of these ingredients can be used to create wallet-friendly meals.
Plan Your Travels Way Ahead of Time
Got that summer travel fever? Well, you may want to ride it out at home unless you’ve already purchased tickets or booked a hotel for a summer getaway. It’s an extravagantly expensive time to travel, and the further out you can plan your trip, the more you will save. You should also aim to be flexible with dates and locations, and be sure to use a credit card that gives you travel rewards or cashback, as previously mentioned.
More From GOBankingRates
