High inflation is subsiding, but many Americans have yet to see relief from elevated prices at the grocery store.
“Grocery prices skyrocketed during the pandemic, and in many cases, they’ve kept going up, even though the pandemic is over,” Sen. Elizabeth Warren, D-Mass., said at a Wednesday Senate hearing.
Shoppers may be infuriated to find certain grocery products — like a pound of chicken breasts or a loaf of bread — go up from one week to the next, Warren said.
And they may be frustrated to find other products — like a box of cereal or a package of spaghetti — come with fewer servings for the same price, she said. That trend is known as shrinkflation.
More from Personal Finance:
This retirement account can be ‘triple-tax efficient’ for teens this summer
College pays, but outcomes for workers without a degree are improving
Lawmakers debate whether child savings accounts can reduce wealth inequality
Lawmakers are divided on what has prompted those elevated prices.
“Grocery prices are up because of good old-fashioned corporate price gouging,” Warren said. “And they can gouge consumers on prices because there’s only a small number of companies controlling every level of the food chain.”
Sen. John Kennedy, R-La., blamed government spending under President Joe Biden.
“When you spend this kind of money, you’re going to have inflation,” Kennedy said.
A recent Harris poll finds almost 3 in 5 Americans think the country is in an economic recession — even though it is not — with inflation a top concern.
“Inflation is coming down, but prices remain elevated,” said Mark Hamrick, senior economic analyst at Bankrate. “As long as prices are elevated, that means that affordability challenges persist.”
Where consumers may see signs of relief
One measure of inflation — the consumer price index — shows the food index was flat in April compared to the prior month.
Yet over the past 12 months, food was up 2.2%.
Certain categories — like apples and eggs — have declined over the past year. Other items like juices and drinks and beef roasts are up.
“I’m seeing a little bit of a light at the end of the tunnel, where it seems like the prices for some items are decreasing or flattening,” said Trae Bodge, a smart shopping expert at TrueTrae.com.
Still, for some households, the long-term higher food prices may be leading to financial stress. New research from the Urban Institute shows Americans may be saddled with debt after turning to credit card, buy now pay later and payday loans to pay for groceries.
Food insufficiency — where households sometimes or often do not have enough to eat — is more prevalent for families with less than $50,000 in income and Black, Hispanic, disabled and younger adults, as well as parents living with children under 18, a recent Federal Reserve well-being survey found.
Some brands are stepping up their efforts to make food more affordable.
This week, Target announced plans to lower prices on about 5,000 items including bread, fruit, vegetables, milk and meat.
As fast food prices rise, McDonald’s and Wendy’s are also adding lower price options to their menus.
How to save money on groceries
To get the most out of grocery store trips, experts say it’s best to have a strategy.
“It’s a good opportunity to create smart shopping habits,” Bodge said.
Where possible, consumers can shift their purchasing habits — to eat at home rather than dine out, or buy chicken instead of beef — to limit the effects of rising costs, Hamrick said.
“There is a range of opportunities to make choices and to substitute at lower prices and to get better value,” Hamrick said.
Visiting different retailers — both in person and online — may help to capitalize on sales and find the best value available.
If a store has a loyalty program, be sure to sign up for it to make sure your purchases are eligible for discounts or rewards, Bodge said.
Switching over to store or generic brands can also provide meaningful savings. Buying products in bulk may help save up to 40%, she said.
Certain websites and apps help make shopping more efficient.
Coupon sites like CouponCabin may provide discounts for ordering groceries online. Flashfood may provide alerts to deals on overstocked grocery items. Martie also provides offers on deeply discounted items.
“If you combine all of those things, you can save significantly on your groceries,” Bodge said.
The method of payment at the checkout counter may also lead to more savings, specifically with regard to cash back rewards through credit cards, she said. To effectively use those perks, it’s important to maintain a balance you can pay off each month.
Read the full article here