Inflation, it’s the word that you are hearing every day and you can’t seem to escape it. That’s because every day when you fill your gas tank or do your shopping, you are paying more than you were last week for food costs and the things you and your family need. Is there an answer to it?
Can you put the brakes on it or are you just bound to fall into the hole that it is creating in your budget? There are ways to fight back, but it takes an effort. It’s my view that you can save and save a lot if you know what to do. In fact, you can save money, eat healthy, and still save as much as 40% off your food bill in 2022. And I’m going to tell you just how to do it!
Food is a big expense for consumers along with housing and transportation. Now, more than ever, saving on food costs is super important.
Why Super Saving Tips Exists
The main reason I began writing this blog 7½ years ago was simple. I wanted to help people save money. I had many years of experience in retailing and had spent the end of my working career with supermarkets. So it was a perfect storm of my knowledge and desire to begin writing “tips” I could offer.
Over time, the blog evolved from saving money to more than that. Earning more and protecting money became a part of it as well as talking about newsworthy money issues, too. That’s why inflation and food costs are such a huge target right now for me and you.
Where Are We Right Now?
Inflation accelerated in October, with Americans facing sharply higher consumer prices as they head into the crucial holiday shopping season. That represents the steepest monthly rise in 30 years!
Consumer prices increased 6.2% from the year-ago period, slightly faster than their 5.4% increase the previous month of September, the Bureau of Labor Statistics said. Core inflation, which strips out volatile food and energy costs, grew 4.6% for this past month.
These swift price hikes are sending financial shocks through household budgets, following almost a decade when inflation rose only between 1% and 2% annually. Americans are souring on the nation’s financial outlook, with more than 6 in 10 calling the economy poor, according to polling from the Associated Press-NORC Center for Public Affairs Research. That’s true even though wages are increasing (up 4.9% this year over last), but that’s not as fast as prices are going up. That combination spells real trouble heading into 2022.
We can debate all of the reasons why inflation has returned and who or what is to blame. The pandemic, profiteering, supply shortages, labor shortages, etc. There are plenty of real reasons for all of it, but that doesn’t change the reality or promise any quick solutions. That’s why saving strategies are so important right now.
Biggest Contributors to Last Month’s Inflation Spike
Here are the biggest contributors to last month’s inflation spike according to the U.S. Bureau of Labor Statistics (October price spikes on a year-over-year basis).
- Fuel oil: 59.1%
- Gasoline: 49.6%
- Natural gas: 28.1%
- Used cars and trucks: 26.4%
- Beef: 20.1%
- Pork: 14.1%
- Milk and eggs: 11.1%
- New vehicles: 9.8%
- Electricity: 6.5%
- Total food costs: 5.3%
Economists now predict that inflation will continue and forecast that higher prices could last well into 2022.
What Do People Spend on Food Costs?
Americans’ monthly grocery expenditures vary drastically and depend on factors like age, state, and income. The average food costs can be a few hundred dollars a month for singles to well over $1,300 a month for families. Consumers with a liberal food spending plan pay double what those with frugal spending habits do. Having children significantly increases the cost of groceries per month.
Averages by State
Food costs vary by location. Residents in Mississippi and residents in Hawaii don’t have the same average cost of groceries per month. Hawaii is, in fact, one of the states with the highest average grocery bill in the U.S. Every state has a different grocery cost index and food cost range.
According to Department of Labor statistics, the average cost of food (for groceries and dining out) for a family of four in the U.S. is about $7,700 a year. In some states like Alaska or Hawaii, residents spend considerably more on food.
A family of four, including partners between the ages of 19 and 50 years old and two children between the ages of 2 and 5 years old, can spend around $890 a month ($10,680 per year), and partners with kids between the ages of 6 and 11 years old can spend $1,062 per month ($12,744), according to the United States Department of Agriculture guidelines for a moderate budget. As you can see, the numbers can vary by a lot, so it is up to you to control them.
No states come near the food expenditures of residents of Hawaii, Alaska, Maine, Massachusetts, and Vermont. That compares to states like Mississippi or Alabama where annual food costs for that same family average much lower, but so do incomes, so it’s all relative.
Living here where I do, New Jersey is a good place to use as a barometer because it ranks just below the top five states in America in food costs. If I can save 40% on my food bill, you can too!
One surefire way to halt your food costs from skyrocketing is a no-brainer. Limit or eliminate dining out as much as possible! But even with that said, a family of four that spends liberally on food could spend as much as $1,287 a month on just groceries for meals at home and not include eating out, according to the USDA guidelines.
This is Part I. What you will learn from Parts II and III?
What I have learned and can pass on to you is the simple tricks to save that you may not use every time you grocery shop, but are more essential than ever. They combat the tricks that supermarkets use to get you to spend more, but you don’t have to fall for them.
I will also show you how meal planning can save you as much as 40% next year if you are willing to put in the effort needed. You will have to change some habits that you may have had for years and years, but if that’s necessary to close your budget gap, then doing it is the way to save.
If you are making it though this rough inflation patch and don’t feel that saving money on groceries is important to you, then you have my permission to “walk the dog” as they say and resume reading the blog in a week or so again. If you aren’t making out so well, then read part II on Friday, covering how to eat a healthy breakfast for about $3 a day for a family of four.
Final Thoughts
I’m not one who likes to brag about my knowledge of anything. This subject of inflation and saving at the supermarket and my knowledge of it partly come from my job, but also comes from making huge mistakes about my money over a lifetime. Those mistakes taught me lessons. You can benefit from my errors and avoid them and that’s not bragging, but a promise. So I will see you next time with some real ways to save. Will you join me?
