Rising inflation hitting consumers in the pocketbook: "Everything is expensive nowadays"
NEW YORK - You're coming out of pocket now more than ever for just about everything.
U.S. inflation has hit a new four-decade high.
Friday morning, the U.S. Labor Department reported prices in May surged 8.6%.
CBS2's Andrea Grymes spoke with frustrated consumers.
Bronx resident Randy Parker has to dig deep into his wallet these days for groceries, spending $80 for meat, bread and other "bare necessities" at two different stores.
"It needs to go back to how it was. People's not rich," he said.
Watch Andrea Grymes' report
Bronx resident Christina Campbell got a free bag of groceries Friday at a Catholic Charities pop-up food pantry in West Farms.
"It comes in handy because I don't get food stamps. So it comes in handy because food is expensive," Campbell said.
Those prices continue to go up. The Labor Department says inflation grew to 8.6% last month, the steepest increase in 40 years.
Prices for housing, gas and food were the biggest contributors, affecting everyone across the country - but especially those most in need.
"Milk, cheese, eggs. Everything is expensive nowadays, so this comes in handy" Campbell said.
The free groceries gave Brooklyn resident Cynthia Burgess a reason to smile amid the latest dim economic news.
"They keep raising the rent. All prices are going up except our paychecks," she said.
Burgess is on a fixed income and says the help "means a whole lot, yes. Lord, it does."
"We're seeing a definite demand for food and basic items," said Richard Espinal of Catholic Charities.
Espinal says although the worst of the pandemic is over, the economy is working against those trying to recover.
"As folks are starting to go back to work, they're finding that again their basic food items are still out of reach, so we're able to assist them with providing them with some food today," Espinal said.
Upper West Side resident Jennifer Kontaxis told CBS2's Dick Brennan she has had it with higher prices and is ready to go elsewhere.
"Unbelievable. I am so lucky I can even afford to buy groceries," she said. "I can see things getting worse all around, and it's really the first time in more than 20 years I've thought about leaving the city."
It's even tougher for senior citizens. Harlem resident Lelia Hartsfield, 78, can't believe how much it costs at the grocery store.
"Outrageous," she said. "I do some comparison shopping ... lots of comparison shopping."
Food prices saw the biggest jump since 1981. Milk is up 15.9%, chicken costs 17.4% more, and eggs soared 32%.
American households are paying $460 more every month to buy the same things they did last year.
Record-high gas prices are forcing some commuters to rethink their budget.
"There's a lot of other things I can't do because I have to pay for gas," driver Quentin McZeal said.
The national average for gas is around $5 a gallon and could accelerate if bad weather disrupts offshore oil drilling.
"It's not impossible that, should we see a refinery snag or a major hurricane in the Gulf of Mexico, that we could see the national average hitting the $6 a gallon mark," said Patrick De Haan, an energy analyst for GasBuddy.com.
Watch Andrea Grymes' report
"There's really honestly no way to avoid it, sadly," said Kristin Myers, editor-in-chief at the Balance.
Myers says there's not much consumers can do to heal the sting of inflation, but prioritizing spending can help.
"Stop going out to eat. Don't go out to drink as much," she said. "You have to make changes, even, to that grocery list. We're seeing right now meat and poultry are spiking in prices while fresh fruits and vegetables have not risen as much."
Myers also says now is not the time to max out your credit cards because those interest rates keep rising. She says try to pay down your debts and pay your statements in full every month, and she adds, don't be afraid to ask for a raise.
What to do about all of this depends on who you ask. Republicans continue to attack the president's policies as reasons for record-high inflation.
"I'm doing everything in my power to blunt Putin's price hike and bring down the cost of gas and food," President Joe Biden said.
The 8.6% growth is the largest 12-month increase since December 1981.
Greg McBride, chief financial analyst at BankRate.com, says back then, the Fed drastically raised interest rates to reverse inflation.
"It worked. It broke the back of inflation, and we've enjoyed 40 years of declining interest rates since, but the price was pretty heavy. We had a double-dip, back-to-back recessions, and at one point, unemployment had crested above 10%," he said.
McBride says this time, unfortunately, the Fed will again have to raise interest rates aggressively. He says consumers may see prices improve over the next six months, but they're still going to be very high.
"The Federal Reserve really needs to address this as quickly as possible," CBS News business analyst Jill Schlesinger said.
She says the Federal Reserve is expected to once again raise interest rates next week, hoping it will ease price hikes, but the effect will likely take time.
"Inflation touches every single American, but those who earn less, they feel the biggest brunt. the three categories of their lives where they spend the most money, which is shelter, food and energy, those areas are rising," Schlesinger said.
"Every spectrum of the economy is really feeling it, but it does hit certain segments of the economy harder -- lower income individuals and certainly people on fixed income," business analyst Shibani Joshi said.
Joshi says consumers don't have much control over these trends, but it makes sense to think long-term.
"The challenge is, is you don't want start to put too much on your credit card balances because credit card rates are going to go up, so it's going to cost you more to do the things that you do every day, so scaling back is the best option," she said.
The experts say make sure you have a plan and stay on budget. Also, do your best to comparison shop, and if you can, buy in bulk.
