Last week opened well, but fears of rising inflation drove the market to decline Thursday and Friday.
Inflation rose to 8.6%, exceeding April’s 8.3% increase. The Consumer Price Index, or CPI, had the highest year-over-year increase since 1981. Grocery food prices increased 1.4% over last month, with dairy prices having their largest increase since 2007.
Food and energy are the prime drivers of inflation. Core inflation, which excludes those two items, fell to 6.0%, a four-month low. Durable goods prices have been decreasing, as supply chain logistics have eased.
You’ve probably already experienced the pain when buying food and gas. From a wallet stand point, one of the best ways to lessen the impact is to make a meal plan. Once a week, sit down with your grocery store flyers and family calendar, and plan out meals for the week. Then, make a grocery list and stick to it. Some grocery stores allow you to add coupons to your rewards cards. Since many of us don’t get a newspaper any longer, the coupon insert companies offer coupons online.
Beyond that, it’s important to realize that non-perishable foods have a pricing cycle, usually about 12 weeks long. The high point of the cycle is the week after a coupon comes out in the paper. If you’re seriously concerned about food costs, grab a notebook and track the price of your frequently purchased items for the next three months. When the price of your favorite cereal, detergent, or other item is at its low point, that’s a great time to buy three months’ worth of the product. And the best time to use your coupons.
If you are an active-duty or retired member of the Armed Forces or a dependent, including the Guard and Reserve, you may want to shift your shopping to the commissary. Under federal law, food is sold at cost plus a 5% mark-up to fund building and renovating commissary facilities. In 2020, access was expanded to any veteran with a service-connected disability.
Your action item this week is to take a hike. Our mental, physical, and fiscal health are all intertwined, and a hike is an inexpensive way to recharge.
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Investment advice offered through Great Valley Advisor Group, a Registered Investment Advisor.
All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
The opinions voiced in this show are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investment(s) may be appropriate for you, contact the appropriate qualified professional prior to making a decision.