4 Ways Families Are Hurt Most by Inflation — And Advice To Overcome Them
Written by
Gina Hagler
Edited by
Nicholas Morine
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Americans have good reason to hope for improved economic conditions. However, a 2022 Pew Research study concluded that inflation is considered a significant ongoing issue for 7 in 10 Americans. According to Experian, debt balances for auto and student loans, mortgages, and credit cards all saw a 2022-2023 increase.
Here are the four main ways that inflation hits families the hardest.
The Basic Necessities of American Life Are Simply More Expensive
- Child care: Families spent anywhere from 17% to 30% of their annual income on child care in 2020 despite the pandemic, per LendingTree, yet a basic service like free school lunches has ended in the interim, maintaining an effect on the country. While the National School Lunch Program provides food to students from low-income households, middle-income households dealing with debt may not have access to the program due to income eligibility guidelines.
- Housing: In D.C., housing prices have almost doubled from 2011-2021, per UrbanTurf. The issue is compounded when factoring in the massive increase in consumer debt, as detailed by Experian.
- Food: U.S. food prices saw an average 9.4% increase in a 12-month period by May of 2022, the highest spike in 40 years, according to the World Economic Forum. Inflation has cooled somewhat since then, with January’s consumer price index indicating that food, overall, increased by 2.6% year-over-year between 2023-2024. The Department of Agriculture predicts grocery prices will increase by 1.3% in 2024, yet in 2022, 44.2 million Americans lived in households marked by low food security. By the same measure, the Department of Agriculture predicts a slight dip in grocery prices (-0.4%), which could be a silver lining. This dip is offset by a 4.7% price increase at restaurants and fast food establishments.
- Utilities: The Energy Information Administration reports that in 2022, residential and commercial natural gas prices rose past the previous 5-year range.
Given all of this concerning information, there are a few ways that adults can improve their finances for the long term.
Take an Extra Job, Cut Expenses, Consider Savvy (and Solid) Investments
There are other sources of income to consider as part-time gigs, like tutoring, catering, photography and delivery driving, as Parents.com indicated. It may also be prudent to go over all memberships and subscriptions — and pause or cancel those that aren’t being used often.
It may be wise to meet with a financial advisor — there are many affordable options to be found through banks and credit unions. When it comes to investing, Patti B. Black, a certified financial planner with Bridgeworth Wealth Management, recommended purchasing price-attractive stocks, mutual funds and ETFs during market drops after close analysis of their performance and upside potential.
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