Grocery Prices Driving Families Into Debt

Steph Bazzle

Updated on:

bitpics/Depositphotos.com
bitpics/Depositphotos.com

The good news is, inflation is slowing. The bad news, however, is that this doesn’t mean prices are dropping, only that they’re not rising quite as fast as they previously were. The worse news is that families still can’t afford food and are actually going into debt to buy groceries.

Food insecurity in America might be hard to imagine, but it was an issue — and in fact, a driver of increasing childhood obesity — even before the pandemic and the ensuing rise in prices. Now, it’s expanding and reaching families who may have never questioned where the next meal came from.

In fact, according to a Pew Research survey, at least 94% of Americans say they’re concerned about food prices, with 72% rating it as something they’re “very concerned” about. That’s higher than the percentage who expressed extreme concern about the housing market, the price of energy (including gasoline), or the availability of jobs.

There’s more: consumers are finding themselves turning to credit cards or even to payment apps that allow a user to pay for groceries in installments. One 26-year-old security guard described his embarrassment at using such apps and said that he’s also switched to ramen noodles and frozen vegetables and cut his meals to twice a day, according to Motherly.

He’s not alone, and families are finding themselves in deeper and deeper holes. For instance, after a survey this year, the Urban Institute reported on their findings:

More than one in six adults (17.8 percent) reported using Buy Now, Pay Later (BNPL) in the past 12 months, including 3.5 percent who reported using BNPL to pay for groceries. Thirty-seven percent of adults who used BNPL for groceries reported missing payments on these loans.

Their research also found that the increase in using credit cards and Buy Now Pay Later programs to pay for groceries was more prevalent among families that had already suffered food insecurity and that these households were also more at risk for inability to make the payments — a horror story that simply leaves those same families with even fewer options going forward.

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Other families report that they’re dipping into savings, originally intended for other purposes, to pay for groceries.

Meanwhile, retailers, including groceries, continue to simultaneously claim that they cannot drop prices because of their own costs and to boast record profits. Jacobin reported:

Americans paid roughly 25 percent more on groceries and dining out this March than they paid in January 2020, outpacing the rate of general inflation. Over that same period, the companies behind the country’s ten largest grocery and restaurant brands have together returned or pledged to return more than $77 billion to shareholders.

Legislators have made some efforts to dull the pain by pressuring retailers to keep prices and profit ranges at more reasonable levels, but so far, consumers aren’t seeing the change. Instead, they’re watching their grocery dollars pour into the pockets of shareholders and creditors.