As gas prices rise, expect to pay more elsewhere
Drivers are bracing themselves for higher prices when they pull up to gas stations. But the pump isn't the only place you can expect to pay more in the weeks ahead.
Filling up your tank Monday hits the wallet much harder than than just one week ago. The average price for a gallon a regular in Minnesota jumped about 40 cents over the past week, according to AAA.
Tyler Schipiper is an associate professor of economics at the University of St. Thomas in St. Paul, Minnesota.
"There are a wide variety of things that get more expensive simply because so much stuff in the United States is delivered by truck," Schipiper said.
He says consumers should expect to spend more on fresh fruits and vegetables since the shipping trucks delivering them to grocery stores are spending more on diesel. Farmers will also be spending more money to run their equipment.
The next category to likely see a price increase is travel. That means airlines and cruise ships could raise their prices to cover their increased spending on fuel.
Products made of plastic or packaged in plastic might cost more since their production is petroleum-based.
The recent gas price increase was not only a large one. It also happened quickly. So, how soon will we see costs rise in those other categories?
For groceries, Schipper said the increase will happen soon, if not already. But other categories will take more time.
"I would expect that there's a longer delay between when you start seeing plastic prices go up and the instability we're seeing right now," he said.
An uptick in the price of plane tickets or booking a cruise would be in the near future.
"If we remain in the current situation with elevated oil prices, that could be somewhere in the next month to two months where we start seeing higher prices as well," he said.
We've weathered sky high prices at the pump before. Maybe you drove less or carpooled to cut costs. How else can we prepare our budget to save money in the weeks ahead?
"One would be booking summer travel now," Schipper said.
Travel expert Kyle Potter agrees, telling WCCO booking flights sooner rather than is the safer bet.
"Will airlines raise fares in order to cover some of their costs? They absolutely will, but that doesn't mean there's going to be an across-the-board fare hike for every single passenger on every route on every date," Potter said.
Buying in bulk is another idea, but Schipper doesn't want people to worry about stockpiling goods right now.
"These markets move really fast, and that doesn't mean that every single little shock or every single new headline is going to translate to higher prices for you," Schipper said.
His other tip to help you budget is to review your subscriptions. Find the ones you aren't using anymore and cancel them to save money each month.
"It can make you feel less guilty when you start filling up at the pump for a few dollars more," Schipper said.