Our shopping carts could become a little less full when thinking about the future, and bank accounts a bit smaller in the next decade.
Why? With increasing global inflation, even everyday essentials might start to feel like a splurge for most of us (even the average American). Rising costs will have us all re-thinking what we truly “need” versus what we merely want.
It’s about time we started considering inflation when planning our finances so that we don’t feel like we’re drowning in bills in years to come.
Here are 15 things that will start to strain your budget in the next 10 years and make you rethink your lifestyle choices.
1. Medical Care
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Healthcare is becoming inaccessible to many people (most in the US) because they can’t afford the high costs of insurance and/or treatments. Technological advancement in the medical field, expensive pharmaceuticals, and high administrative fees associated with healthcare insurance and healthcare delivery add up to the costs.
According to PwC, medical treatment costs are skyrocketing because of rising inflation. In 2024, medical costs are expected to increase by 7% each year, more than we saw in 2022 and 2023. What’s even worse? It does not look like this trend is going to reverse.
2. Homeownership
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As said in The American Economic Review, in the last 30 years, housing prices have been rising regularly. The average price for a used single-family house across the country increased by 3.5% compared to last year. Well, it’s bad news for buyers because wages might not increase enough to keep up with the rising cost of living, making it hard for people to afford a down payment or housing expenses in the next few years.
3. Transportation
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Traveling via car is already expensive, and it will become unaffordable in the coming years because of steady increases in fuel prices and high maintenance costs. Unfortunately, public transportation isn’t faring much better either. Frequent fare hikes will make the situation worse for the people who rely on public transport.
According to research , people worry because those with low incomes spend a disproportionately larger proportion of their total income on transportation.
4. Education
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Tuition fees are increasing at the fastest rate after medical care. Although financial aid often helps students pay less than the listed tuition price, the actual cost of attending public four-year colleges has more than doubled since the year 2000. Also, the basic expenses at American colleges are the highest among the bigger developed countries.
This rise in tuition fees can make public and private education unaffordable for many families when they are already dealing with high living costs and stagnant salaries.
5. Exotic Travel
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With the increasing popularity of exotic destinations, there is an upsurge in demand for flights, accommodations, and tourist activities- driving up prices across the board. The dream of visiting far-off destinations may become more challenging to fulfill for a significant portion of the population.
6. Rare Wines and Spirits
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With economic changes and shifting consumer choices, rare wines and spirits are becoming even more exclusive, making it impossible for ordinary people to get them. Moreover, the rising demand for wine and spirits keeps prices high.
7. Designer Clothing
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As labor and marketing costs for designer clothes increase, these items’ price tags increase. Some people will still buy it after a decade to show off their wealth or because they think it makes them look more fashionable. But for many people, the high prices will be just too much to pay.
8. Life-saving Medications
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The healthcare industry is always working toward developing treatments to deal with chronic diseases, and the costs of research and development are expected to rise significantly.
Unfortunately, these increased expenses are often passed down to consumers, making life-saving drugs more pricey. As a result, many individuals may struggle to afford these essential drugs in the next 10 years. According to research , the rising cost of medicine has been a huge public health problem for nearly thirty years. Sadly, many people withhold their treatments because they can’t afford the medications.
9. Cars
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Let’s talk more about cars. Owning a car means freedom and comfort, but it’s no secret that maintaining a vehicle can be expensive.
In the next 10 years, people might find it hard to afford cars because of government policies, everyday fuel price hikes, and advanced features. For reference, a recent report reveals that the price of new vehicles in January 2024 is 19.6% higher than in January 2021.
10. Digital Privacy Services
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Digital privacy services like VPNs are in high demand. Unfortunately, the increased use of technology comes with extended cyber threats, indirectly increasing digital privacy services’ prices. According toresearch, the VPN industry is predicted to be very high in the coming years and almost unaffordable for the average income holder in the coming years.
11. Quality Mattress and Bedding
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Within the next 10 years, not everyone will be able to afford a good night’s sleep because the prices of a decent mattress might go up significantly. As demand for eco-friendly materials increases (and tariffs impose a cost barrier), so will their prices, making a peaceful sleep a far-fetched dream.
12. Childcare
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Childcare, such as daycare or babysitting, helps parents care for their children while they work or attend school. Some families might find it hard to pay for childcare, especially if they have low incomes or multiple children to take care of. Unfortunately, childcare is unaffordable almost everywhere across the country, and parents below the poverty line are mostly impacted.
The unaffordability will become intense. According to a report, childcare costs are increasing significantly because of global inflation. In 2023, average daycare fees increased by 9% in the US.
13. Food and Groceries
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The cost of food has always been a concern for many households, but in the next 10 years, it is expected to become even more expensive. According to CNN, food will become scarcer, grocery prices will spike, and crops will lose their nutritional value due to the climate crisis, natural disasters, and economic factors. Ouch. It just might be time to start the small homestead or even a window garden.
14. Retirement Funds
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Retirement savings are a crucial part of financial planning, but with increasing life expectancy and the rising cost of living, the amount needed for retirement constantly increases. In 10 years, some people won’t be able to afford to retire at all.
15. Electricity
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With a shift towards renewable energy sources, the cost of power bills is expected to rise significantly. This will make it incredibly difficult for the average household to afford its energy needs.
What will the solution be to inflation when salaries aren’t keeping up? Only time will tell.
Read more:
12 Smart Moves to Stop Inflation from Eating Your Money
16 Inflation-Friendly Food Swaps
