A look at the prices consumers pay for goods and services is an eye-opener. Now that we’re finishing the first quarter of 2019, you may have noticed a jump in prices for some goods and services. Many attribute the price increases to recent global trade wars. Other factors include a combination of inflation, rising interest and shifts in the market.
With prices rising, you’ll need to get your budget in order to account for the cost of these basic items in the coming months:
Groceries & Food
According to Fox Business, food prices are up. Mondelez International, one of the world’s largest snack companies (makers of Oreos, Triscuits, Fig Newtons and Wheat Thins) hiked prices to cope with higher freight costs.
Do you drink Pepsi or Coca-Cola? Enjoy a bowl of Campbell’s Soup? Consumers can expect to see prices go up on canned goods such as beer, soda, and soup, which are mostly made with imported aluminum—according to FoodandWine.com.
And eating out will cost more, too. Datassential, a company which researches restaurant menu trends, says prices are creeping up for fast food. The reason? Consumers are willing to pay more. And workers’ wages are up.
According to a recent study, the Center for Automotive Research (CAR) predicts a dramatic price increase on new autos, based on tariffs. CAR reports “…consumers would see the price of the typical vehicle sold in the United States rise by $4,400. Prices of U.S.‐assembled vehicles (may) rise due to an increase in the cost of imported vehicle parts, adding $2,270 to the price. For the typical imported vehicle, these tariffs (would) raise consumer prices by $6,875 per vehicle.”
You could always count on television sets to get better and cheaper every year. But according to Consumer Reports, tariffs are anticipated to make the copper bits and other components used to manufacture TV sets more expensive—with import costs of additional 25% passed on to the consumer.
Many appliance manufacturers are increasing prices up to 17% based on the newly imposed tariffs. According to Bloomberg, “prices paid by U.S. consumers for laundry equipment surged by the most since 2006.” According to the American Enterprise Institute, from February to May 2018, “washing machines saw a 16 percent increase in prices, the largest three-month hike ever recorded.” According to the National Retail Federation, other household goods affected by tariffs include mini fridges and air purifiers.
Live, on demand subscription access to popular TV shows and movies is getting more expensive. Content costs and competition are spurring the rate hikes.
Netflix’s most popular plan recently increased to $12.99 per month, up from $10.99. Hulu dropped its lowest-tier price to $5.99 monthly, but raised its multi-device plans—now as high as $15.99 a month. Amazon Prime Video, PlayStation Vue, Sling TV, and DirecTV Now all had price hikes this past year.
In addition to the environmental benefits, the switch to e-statements for record keeping is making more sense now that the cost of paper products is on the rise. Last year, wood pulp prices rose 23%—leading to paper-product price increases of 7-15%.
Industry consolidation is expected to drive solar panels prices up by as much as 15% over the next two years. If you’re thinking about buying panels, you might want to go solar sooner than later.
According to Barron’s, “Worldwide coffee consumption is rising, and there’s potential for a supply deficit by year end, so a price bump in your $3 morning coffee would be on the way.” Other reasons for the increase are the rising price of coffee beans due to climate change and deforestation.
Auto insurance companies are losing money—and it will cost you more for coverage. Personal finance website ValuePenguin reports that, “The combination of record-setting natural disasters, an uptick in distracted-driving accidents and the increasing prevalence of tech-loaded vehicles that are expensive to repair mean insurers are likely to raise rates in 2019. These factors, coupled with the fact that insurers have failed to turn an underwriting profit in recent years—despite year-over-year rate increases—indicate that drivers will pay more for car insurance in the coming year.”
Resources: Motley Fool, Reader’s Digest, Consumer Reports, DealNews, MoneyTalksNews, Bloomberg, Fox Business, Food & Wine, Datassential, The National Retail Foundation, Barron’s, ValuePenguin