Unlock Premium Data: Up to 50% Off InvestingProCLAIM SALE

Inflation Hits Home: Parents Face Mounting Financial Pressures As Prices Soar

Published 22/05/2024, 20:08
© Reuters.  Inflation Hits Home: Parents Face Mounting Financial Pressures As Prices Soar

Benzinga - by Aaron Bry, Benzinga Editor.

You can buy all the parenting books you want, but chances are you don’t realize how expensive kids can be till you have them. And while inflation is eating into the pockets of most Americans, rising prices are hitting American parents the hardest, with the situation being the most dire in almost a decade, according to a recent Federal Reserve survey.

What Happened: The percentage of parents with children under 18 who felt financially secure dropped from 69% in 2022 to 64% in 2023, the lowest level since data collection began in 2015, the New York Post reported. The overall percentage of U.S. households that reported their financial health as “OK” fell to 72% in 2023, the lowest since 2016.

Of the 11,000 adults surveyed in October 2023, 35% cited price hikes as their primary financial concern, up from 33% the previous year. Inflation peaked at 9% in June 2022 before gradually falling to just under 4% by the time of the survey. However, inflation has remained stubbornly high this year, prompting the Fed to postpone an anticipated cut to the 23-year-high interest rate.

According to a survey, 65% of respondents reported that rising prices had negatively impacted their financial situations. Meanwhile, only 34% noted an increase in their family’s monthly income over the past year. The survey also found that 38% of respondents had increased their spending over the last 12 months.

Why It Matters: The rising cost of living has led to a significant financial burden for American families. A study by the Urban Institute revealed that the increasing prices of groceries, a consequence of overall inflation, have pushed many families to use their savings, credit cards, buy now, pay later installment programs, or payday loans to cover their grocery bills in 2023. This trend is causing financial instability for many households.

Despite the slowing rate of price increases, households are still spending more on groceries than they did the previous year. This has led to many Americans resorting to debt to keep their kitchens stocked, causing financial instability for many households.

On the other hand, some experts see a silver lining in the inflation cloud. Peter Mallouk, President of Creative Planning, emphasized that the rising costs of everyday items, like a can of Diet Coke, will eventually be reflected in stock prices. Mallouk explained that contrary to popular beliefs, one should invest in the stock market during inflation instead of turning attention to asset classes like gold.

Read Next: Silver Rockets To 11-Year Highs, Copper Hits Record Peak, Gold Approaches Historic Close: Mining Stocks’

This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image generated using artificial intelligence via Midjourney.

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Read the original article on Benzinga

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.