Although inflation across the U.S. is far cooler than in the post-pandemic years, millions of Americans say they still feel the pinch of rising prices, struggle to pay the bills and express concern about their financial prospects.
Price increases are nowhere near the level reached in June of 2022, when the Consumer Price Index hit a 40-year high of 9.1%. Yet many people feel squeezed by the cost of simple daily necessities, including the ability to afford healthy food, and by long-term increases in the cost of essentials such as housing and health care.
This affordability crisis is rooted in a combination of both longstanding economic issues dating back decades and more recent developments. For instance, housing costs have surged partly due to a lack of available homes, a result of cutbacks in construction following the Great Recession, while more recently steep new U.S. tariffs have fueled inflation.
Inflation and the economy now rank as Americans’ top national concerns, according to an October CBS News poll.
“Everything is going up in price very quickly,” said Jeremy Tolbert, a 47-year-old web developer in Lawrence, Kansas.
With his family’s monthly health care premiums set to rise 18% to $2,600 next year, he’s planning to cut back in other areas. “Our food budget is going to go down — we’re not talking about eating beans and rice, but going from a comfortable middle-class lifestyle to eating how we did when we first got out of college,” Tolbert said.
Here are five key categories of spending that many Americans are struggling to afford.
Food
Almost half of Americans say it’s harder to afford groceries today than it was a year ago, according to a September survey by Axios and the Harris Poll. Only 19% said food prices are cheaper than a year earlier, with roughly a third seeing no change.
Growth in food prices has eased considerably, although it is still rising, with the latest CPI report showing grocery prices rose 2.7% in September on an annual basis, a sharp contrast to the 11.4% increase in 2022. Overall, however, food prices as of September were more than 18% higher than in January of 2022, according to the CBS News price tracker.
Shoppers don’t assess food costs the same way economists do. They focus on their day-to-day spending — which keeps climbing — and compare their out-of-pocket spending today with what they paid several years ago, according to research from the University of Florida.
In other words, people’s experience of inflation and how they measure it in their daily lives may not mesh with official economic measures that paint a more optimistic picture.
Meanwhile, other recent signals underscore the difficulty many Americans have simply putting food on the table. Roughly 14% of U.S. households reported food insecurity on average between January and October, up from 12.5% in 2024, according to data from Purdue University’s Center for Food Demand Analysis and Sustainability.
Housing
Almost three-quarters of Americans said housing has grown more unaffordable in their communities in recent years, according to an October poll from YouGov and the University of Florida Center for Public Interest Communications.
The data backs that up, with a homebuyer today needing to earn $121,400 a year to afford a typical home, meaning that their monthly costs would remain below 30% of their annual income, according to the Federal Reserve Bank of Atlanta. The average American earns about $84,000 a year, highlighting the considerable gap between incomes and home prices.
Several forces have pushed housing costs higher. The rate of home construction plunged after the 2008-09 financial crisis, leading to a shortfall in housing inventory. Meeting today’s demand for housing would require building as many as 4 million additional homes beyond current construction levels, Goldman Sachs estimates.
The low interest rates that prevailed during the pandemic, when homebuyers could secure mortgages below 3%, sparked a buying rush that sent prices soaring. Even with a slight cooling this year, homes are selling for about 25% above their 2019 levels, while mortgage rates have more than doubled since their pandemic lows.
Child care
The challenge of affording child care is another pain point for many families. In 2024, the average annual cost of care for one child around the U.S. topped $13,000, up 30% from 2020, according to Child Care Aware America, a nonprofit group.
Families with a single child can end up paying between roughly 9% and 16% of their median income on full-time day care, according to the Department of Labor. That means parents are often spending more on child care than they do on other expenses, such as groceries or even rent, data shows.
Gina Monroe, a 42-year-old mom based in Massapequa, New York, said the financial strain of child care has made her and her husband think twice about having another child. She started sending her two-year-old son to day care in September and pays around $450 a week.
“Nothing’s getting any cheaper,” she told CBS News.
Child care costs have surged partly because there aren’t enough early education workers to support the number of children who need care, according to experts. The industry also pays meager wages, adding to the challenges of recruiting new workers, said Keri Rodrigues, co-founder and president of the National Parents Union, an advocacy group for American families.
Health care
Americans are also getting socked by rising health care costs, ranging from higher insurance premiums to out-of-pocket expenses such as deductibles and co-pays. The increase in medical costs stems largely from the emergence of more expensive treatments, such as the popular GLP-1 weight loss drugs, as well as an aging population that requires more care, according to consulting firm Mercer.
The cost of health care was at the center of the longest government shutdown in U.S. history, with Democratic lawmakers pushing to extend a tax credit to defray the cost of health insurance for 22 million Americans who buy coverage through the Affordable Care Act.
The shutdown ended without an agreement to extend the subsidies, which means low- and middle-income households that previously qualified for the tax credits would likely see their ACA premiums rise from an average of $888 in 2025 to $1,904 in 2026, according to a KFF analysis.
Employees who get their insurance through employer-based plans are likely to see their health care costs rise as much as 7% for their 2026 plans, according to Mercer.
Electricity and utility costs
Americans now pay an average of $265 per month in utility costs, up 12% since last year, according to a new report from The Century Foundation, a progressive think tank, and advocacy group Protect Borrowers.
The surge stems from a succession of rate hikes across the U.S, as electricity demand outstrips supply. In 2025 alone, more than 124 million Americans are expected to see some sort of rate increase in their energy bill, a recent PowerLines report found.
Even if you do your best to shut off every light, some fixed costs are unavoidable, such as the so-called “delivery charge,” or what a utility charges to send electricity from a power plant to a home, said Rodrigues of the National Parents Union.
The energy burden falls most acutely on low- and middle-income families, who spend between 6% and 10% of their income on energy, or three to five times that of higher-income households, according to the National Energy Assistance Directors Association.
Economy, Inflation
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