Prices are rising for goods and services across the board; but at the end of the day, what does that mean in dollars?
We all know inflation has been a big financial punch in the stomach, with food costs up 5 percent and energy up 29 percent. But how much will those increases cost you in actual dollars spent ... $500?
Would you believe that households earning over $100,000 will pay an additional $1,300 a year for gas alone? In a moment, more real numbers based on your income level.
But first, let me tell you how I got to those numbers. A recent Wall Street Journal story underscored that many common household costs are increasing, but here's what was really cool about the article:
The authors took the Bureau of Labor Statistics' average consumer expenditures from 2006 and brought them forward using the latest inflation figures. The result is a line-by-line estimate of what an average household spends today on key categories such as food, motor fuel, health care, and housing.
Here's a benchmark for what today's inflation might mean for your household spending in dollars. And just as importantly, how much that spending might increase in coming months.
You can, of course, draw your own conclusions. Here are a few for starters:
The inflation rate for energy far outpaces the others, but you already knew that.
More to the point: You'll cough up another $1,000 or so, depending on your income, for gasoline and $700 or so for utilities. Ouch.
Housing is big, too. Even though home prices and rents are on the decline in some markets, you'll take a hit on overall housing costs, including interest expense, taxes, maintenance and insurance.
And food, of course: Another $800 to $1,000, and that's if current inflation estimates hold. I think we could be in for an unpleasant surprise here, though.
Use these figures to see where you are compared to the crowd — and where you're headed. They are national averages so you may experience something else depending on where you live.
Painful as they may be, the real numbers can help you know where you're going.