The recent surge in inflation has left many Americans reeling, with the Bureau of Labor Statistics reporting an 8.2% increase in the cost of living compared to last year. DollarSprout conducted a survey to gauge how inflation is impacting people across the nation. The findings reveal a range of perspectives and behaviors as Americans adapt to these economic changes.
Contradictory Views on Inflation Causes and Solutions
A notable 44% of survey respondents believe government spending is the primary driver of inflation. Yet, in a twist of irony, 75% support the distribution of stimulus checks as a means to combat inflation. This juxtaposition suggests a complex relationship between the perceived causes of inflation and the solutions people favor.
Adapting to Rising Prices
As inflation began to rise late last year, many consumers were slow to adjust. Initially, the Federal Reserve referred to the inflation as “transitory,” implying it would be short-lived. However, as the months passed and inflation persisted, its impact became more pronounced. More than 50% of those surveyed have delayed significant purchases due to the current economic environment.
Maximizing Financial Tools
With rising costs in essentials like food, gas, and housing, people are searching for ways to stretch their dollars. Surprisingly, many are not fully utilizing available financial tools. For instance, 65% didn’t realize they could stack rewards from cash back credit cards with cash back browser extensions. Using both simultaneously, consumers could potentially earn significant savings on purchases. For example, a combination of a Chase credit card offering 1.5% cash back with a cash back extension like DollarSprout Rewards offering 2% could yield a 3.5% return on a single purchase. In an era where inflation exceeds 8%, such strategies can substantially mitigate rising costs.
Another overlooked strategy is the proactive search for coupon codes. While some consumers wait for coupon codes to be advertised by influencers or retailers, there are tools like Honey, Capital One Shopping, and DollarSprout Rewards that automatically search for discounts. Despite these resources, over 10% of online shoppers never search for coupon codes, and less than half do consistently.
Financial Mindset and Retirement Savings
The financial strain is causing many to rethink their long-term savings plans. About 49% of respondents have either reduced their retirement savings or stopped contributing entirely. This hesitation to save for the future reflects a broader sense of financial insecurity.
Delaying Major Purchases
Inflation has also pushed many to reconsider timing on large expenses. Around 30% have postponed buying a car, while 15% have delayed purchasing a home. These decisions are symptomatic of broader economic caution, as people wait for more stable financial conditions.
Overall, the survey results paint a picture of a populace grappling with the realities of inflation, revealing gaps in financial literacy and an urgent need for better financial strategies to navigate these challenging times. While the future remains uncertain, understanding these trends can help individuals make more informed decisions and maximize their resources.
