Amid an Inflation Squeeze, Americans Get Creative With Their Dollars

Rising Prices Everywhere

The Consumer Price Index rose 9.1% on an annualized basis in June. The main categories driving headline inflation are necessities like gas, shelter, and food. Many Americans are scrambling to stretch their income so these non-discretionary budget line items can be covered.

Given that groceries cost about 12% more today than they did last year, many consumers are rethinking their shopping habits. Some are shunning big box grocers in favor of dollar stores, where an expanded product selection can snag them more than just household staples like cleaning products and toiletries.

Dollar Store Dining

Some dollar stores are now offering perishables, allowing more families to put together dinner on the cheap. Currently Dollar General (DG) offers fresh produce at 2,300 of its 18,000 stores. The company plans to bump that up to 10,000 locations over the next few years. Dollar Tree (DLTR) also offers a variety of perishables at most of their 16,162 stores, though company representatives note they do not completely replace the traditional grocery store due to their limited offerings.

Also illustrating the bargain-oriented trend, Walmart’s (WMT) Sam’s Club saw a 10.5% increase in membership revenue. The warehouse offers discounted products that consumers buy in bulk.

Tips and Tricks

Squeezed by inflation, more people are finding that cutting back on discretionary expenses like vacations and restaurants isn’t enough. Consumers are finding new ways to save.

In addition to shopping for meals at the dollar stores, some are choosing cheaper options such as beans or peanut butter in lieu of meat. Others are using spices to doctor up cheaper foods.

Choosing to shop at locations closer to home helps to save money on gas, which has seen price increases of about 60% for the year ending in June. Others are limiting energy consumption following annual price increases of about 42%. Ultimately, Americans are prioritizing their spending, and exploring new options so they can pay for essentials.

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