Inflation and cost of living
The cost of living for any American is impacted by inflation. Inflation is a decrease in the purchasing power of our money, as reflected in a general increase in the prices of goods and services.
Inflation can happen when prices increase due to increased production costs like raw materials and wages or an increase in demand for products and services, which means consumers are willing to pay more for them.
At the time of writing, inflation is around 7%. That means a pencil that cost $1 in 2020 would cost $1.07 today. That’s inflation at work.
Common monthly expenses in the USA
These are some common monthly expenses in America and their average costs:
Housing: $1,784
Utilities: $300
Transportation: $819
Food: $610
Food Away From Home: $198
Healthcare: $431
Entertainment: $243
Gas: $131
Clothing: $120
Personal Care Products and Services: $54
Education: $106
Total: $5,172
Don’t be alarmed by that number! Remember, these are averages. And some people won’t have all of these expenses. If you live in a walkable city or one with a robust public transit system, you won’t have any gas expenses, and your transportation expenses will be much lower, maybe even $0, if you walk and cycle a lot.
A combined $808 per month for food is high unless you’re a family with a few members. A single person wouldn’t need to spend nearly that much. Some employers pay all or part of their employee’s health insurance premiums, and if you don’t have children and aren’t in school yourself, you won’t have any educational expenses.
Upwardli can help
For some, the cost of living in the US is a relief! It’s much lower than it was at home. And for some, it’s an enormous change, much more costly than at home or with many new expenses. America largely does not subsidize things like health care, child care, or education as many countries do.
Whatever your situation, Upwardli can help you find the financial tools you need to succeed in the US, including credit cards, apps, savings accounts, and personal loans.
With Upwardli, you’ll get pre-approved instantly - no credit check or deposit required! Each account includes an unsecured line of credit designed to build credit fast. We report your progress to the credit bureaus to help establish your credit history.
As a seasoned financial expert with a comprehensive understanding of economic concepts, I want to delve into the crucial topics addressed in the provided article on inflation and the cost of living in the United States.
Inflation: A Decrease in Purchasing Power
Inflation, as mentioned in the article, is a decline in the purchasing power of money, leading to a general increase in the prices of goods and services. The evidence lies in the current inflation rate, cited at around 7% at the time of writing. This means that the cost of goods and services is rising, impacting the everyday expenses of Americans.
Understanding the causes of inflation is essential. The article touches upon two primary drivers: increased production costs and heightened demand for products and services. Production costs rise due to factors like increased costs of raw materials and higher wages. Additionally, when consumers are willing to pay more for products and services, demand-driven inflation occurs.
Monthly Expenses in the United States
The article provides a breakdown of common monthly expenses in the U.S., offering average costs for each category. This information is valuable for individuals seeking to manage their finances effectively. Here's a summary of the listed expenses:
- Housing: $1,784
- Utilities: $300
- Transportation: $819
- Food: $610
- Food Away From Home: $198
- Healthcare: $431
- Health Insurance: $306
- Entertainment: $243
- Gas: $131
- Clothing: $120
- Housekeeping Supplies: $70
- Personal Care Products and Services: $54
- Education: $106
Interpreting the Numbers: Averages and Variability
It's crucial to note that these figures represent averages, and individual circ*mstances may vary. For instance, some individuals may not have certain expenses, like gas, especially if they live in a walkable city with robust public transit.
The article rightly emphasizes that the $808 per month allocated for food may seem high for a single person, as individual needs differ. Similarly, not everyone has educational expenses, especially if they are not currently in school.
Upwardli: Financial Solutions for Varied Situations
The article introduces Upwardli as a resource to navigate the financial landscape in the U.S. It highlights the diversity of situations, noting that the cost of living can be either a relief or a significant change for individuals. The mention of Upwardli's services, including pre-approved financial tools like credit cards, apps, savings accounts, and personal loans, demonstrates a practical approach to addressing diverse financial needs.
The claim that Upwardli provides an unsecured line of credit designed to build credit fast and reports progress to credit bureaus adds credibility to its effectiveness in helping individuals establish a credit history. The emphasis on instant pre-approval without a credit check or deposit requirement further positions Upwardli as a convenient and accessible financial solution.
