A quick explanation of inflation and why it's hitting so hard right now.
Does it seem like it's getting a little harder to buy almost everything? From your Starbucks, to your groceries, even your Tide Pods have gotten more expensive. If you're noticing this, you're not crazy..and you're not alone. Who knew it was so expensive to just... live?
For those of you who didn't study economics, this is what the news is constantly referring to as inflation. It is measured using something we call the Consumer Price Index, which is the average change in the price normal people pay for things. Recently, the Bureau of Labor Statistics data (the ones responsible for measuring this) showed prices have risen 7.9% over the last 12 months... This is the fastest prices have increased in the past 40 years. (Lucky us to be starting out with these entry level pay jobs).
So it's no wonder that you're feeling the pressure on your bank account... almost everyone is.
The reasons to blame are a bunch of things... COVID, supply chain problems, and businesses having to pay more to keep their employees during this "great resignation" period.
On top of that, I am sure you have noticed that your paycheck hasn't increased enough to cover these higher expenses. Well that is because wages are only growing at around 4.2%... so it is as if you are taking a 3.7% cut in your paycheck (4.2% wage growth - 7.9% inflation).
Now, of course, all of this depends on the type of job you work, what you're spending your money on, etc. But the truth for the majority is that the world is getting more expensive and our paychecks just aren't keeping up with it. This makes it almost impossible for our generation to do all those things our parents keep yelling at us about.. like creating sufficient savings, getting married or buying a house. (Well maybe inflation isn't to blame for our horrendous dating lives).
Moral of the story is: if you're feeling overwhelmed by your finances, or like you're "falling behind" like I have, do not feel alone. Almost everyone is experiencing this, and the best we can do is find ways to slowly improve.
Hopefully I will be able to give you some tips to save where you can and make a few extra dollars here and there to take off some of the financial pressure of being a human.
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