Why are groceries more expensive now?
What do eggs, gas and homes have in common? They cost a lot more than they did a few years ago! You've probably heard adults talking about how prices have gone up lately. Did you know that this is because of something called inflation?
Here's a scenario to teach you more about it.
Errands for grandma
Your grandma has asked you to help her prepare some delicious meals by picking up a few things at the grocery store. It's easy. Just use the list she gave you.
After you pay for the chicken, apples, carrots, a dozen eggs, butter and tea, the cashier gives you the receipt. The total comes to $29.60.
When she sees the total, your grandma exclaims, "Oh goodness. Things were so much cheaper in my day!" She shows you a receipt for the same products, from the same store, from 1995. Here they are side by side.
The same groceries cost $14 in 1995 and $29.60 in 2022. More than double! Your grandma was right. Things are more expensive than they used to be.
Why is that? We have inflation to thank!
Infla...what?
Inflation is when the prices of many items go up at the same time. This means that you can't buy as much with your money.
It's normal. Over time, things cost more. Sometimes, prices go up slowly. Other times, like in the last few years, prices go up much more quickly.
While inflation is normal, it can make things harder on people. Sometimes salaries don't go up as quickly as the price of goods.
You may have less money than before based on your job or lifestyle. In this case, you'd need to cut back on your expenses and prioritize the essentials like rent, groceries and transportation.
What causes inflation?
Inflation doesn't come out of nowhere! Different events may cause prices to go up.
Why would a wooden toy manufacturer have to raise their prices?
Wood is more expensive than before (they need it to make their toys).
Prices at the pump have gone up (shipping trucks need gas to move).
Employees want a better salary.
Workshop rent has increased.
More people want to buy their toys.
And because toys are expensive for the manufacturer to produce, retailers end up increasing prices to avoid losing money. That means consumers end up paying more.
Inflation affects everyone's budget and many families may have to review their expenses because of higher prices.
Summary
Inflation is when the prices of many items go up at the same time for a certain period of time.
Impacts
You may have less money than before based on your job or lifestyle. In this case, you'd need to cut back on your expenses and prioritize the essentials like rent, groceries and transportation.
What you can do to lessen the impact of inflation:
Make a budget so you can plan for big and small expenses based on how much money you have available.
Avoid videos and content that make you want to buy something right now.
Wait a day before making a big purchase. Sometimes, when take the time to think about it, you realize you don't need it!
Cook at home and try out new and exciting recipes with your family. If you have a favourite dish when you eat out, try making it at home!
Produced in collaboration with Les as de l'info.