FORT WAYNE, Ind. (WANE) – “Bonkers” inflation has hit the Midwest harder than the nation.
That was the word first used when the Bureau of Labor Statistics Wednesday released the consumer price index. Prices here are up 9.5-percent compared to 9.1-percent nationally.
“You don’t need the Bureau of Labor Statistic to know that inflation is still with us,” Rachel Blakeman, director of Purdue Fort Wayne’s Community Research Institute. “If you feel you’re paying more at the grocery store, restaurants, for everything, you’re not imagining it.”
Since June of last year, cereals and bakery products are up more than 16%; other food items, more than 17% and non alcoholic beverages, 14.5%.
And that’s just a start with no end in sight, Blakeman warned.
Even though house prices have stabilized, interest rates went up. Wheat for bread may be pricier because Ukraine is one of the breadbaskets of the world and the supply chain has been interrupted.
Why is this?
It’s a market situation, Blakeman says, with lots of different things happening. There’s the conflict in Ukraine that has interrupted the supply of gasoline and fuel from Russia and is rippling through the economy.
Then there are COVID-based shutdowns in China.
“When China does a shutdown, then supply chains throughout China will be interrupted and we continue to have variants,” Blakeman said.
So what are the tactics people can use to get their finances prioritized as the belt tightens?
Tactics include scaling back, substituting and avoiding. For instance, that big vacation out west or to New York City you planned for this summer? You can scale back and instead substitute a camping trip to Michigan, Blakeman said.
“For things like food that we have to buy month over month, are families making different choices?” Blakeman aside.
You may have been one to buy organic milk for your family, for example, and now you don’t. Instead of eating out four times a month, you cut it down to two. Those easy-to-order pizzas, well maybe you’ve decided that frozen pizza looks good, she added.
You might scale back on meat and go to plant-based meals or switch from sirloin to ground beef, she suggested. And scale back your streaming services and cable television service. Consider taking your lunch to work rather than buying take-out.
Dropbox.com suggested making a list of your entire financial picture. That would include:
- Monthly income
- Credit card repayments
- Insurance premiums like health, car and life insurance
- Mortgage repayments or rent
- Cell phone plans
- Living expenses – average grocery and utility bills per month
- Student loans
- Cell phone plans
- Car payments, car running costs or public transportation budget
- Child care and gym membership
- Savings – money you want to save each month
People should deduct their total expenses from their salary to see what disposable income is left, Dropbox said.
Kassidy Fike, a Fort Wayne resident, keeps track of family finances on an Excel spreadsheet, a free tool.
“We give ourselves a monthly budget. We take out about $100 of each paycheck. That is our spending limit for anything other than our essentials,” Fike said.
The family has a $150 membership at the Fort Wayne Children’s Zoo and they visit often. They try to save the $100 and set it aside for something special. At the grocery store, Fike says she saves money on meat by purchasing it pre-packaged.
“It’s all about will power and self restraint honestly,” Fike said. “And if you want something, you’ve just got to tell yourself, three months. Save up for three months, you’ll get it.”
Goodbudget is a free app that also has a paid app for more services, according a young mother interviewed Wednesday who didn’t want to be named.
Dropbox cites U.S. Senator Elizabeth warren’s 50/30/20 budgeting program. Needs should be 50% of your income, wants 30% and savings 20%.
There’s also the envelope method. Studies have shown that people who pay cash and ditch their credit and debit cards usually spend less.
“It’s really about setting the priorities for your budget,” Blakeman said. “So it’s really about deciding what’s important to you. It’s really about what works best for your budget.”