The new year instills a sense of excitement as we resolve to improve ourselves and anticipate building upon the previous year’s successes. Corporations are also re-assessing their strategies and prices going into the new year, which will effect the consumer in various ways. According to shopping deals news site, dealnews.com, consumers should expect 2012 prices to be higher for essential items. Along with the reason for the price increase, I’ve included a strategy to combat the rate hike and keep more money in your pocket.
- Airfare: Citing an American Express prediction, dealnews says North American airfare will increase 5% for economy seating and up to 7% for first class. Europeans can expect to pay £21 (roughly $15) more per flier due to a new Air Passenger Duty (APD) enforced by the European Union (EU). Strategy: Pay less for airfare by buying after Tuesday at 3:00 PM EST but no later than Thursday. If your schedule is flexible, Wednesday flights are the most affordable since demand is low.
- Food: Most retailers, according to dealnews, have reported that food prices are rising and those increases are being passed along to shoppers. Food costs increased by 6% in 2011 and expected to rise another 2% in 2012. Strategy: In addition to coupons, use a credit card which provide cash back for supermarket purchases. The American Express Blue Cash credit card offers up to 5% cash back on supermarket purchases.
- Hard Disk Drives: Due to the devastating 2011 monsoon floods across most of Thailand, there has been a global shortage of hard disk drives. The floods had a debilitating effect on most of the country, including the corporate parks which make up to 25% of the global supply of hard disk drives.
As a result, there will be fewer hard disk drive discounts until the second quarter of 2012, which experts predict production will return to normal. Strategy: If you absolutely cannot wait until the third quarter of 2012 to buy your new hard drive, spend a few days monitoring hard drive deals on popular deal site such as techdeals.net, techbargains.com, and slickdeals.net. Each site will send low price alerts to an email address of your choice every day.
- City-Enforced Fees: Many major cities are in the midst of budget shortfalls going into 2012. Some are expecting to miss the mark by millions or even billions of dollars. As a result, cities are looking for creative ways to increase revenue through fees and rates. Strategy: City fees are assessed for penalties or essential services. Unfortunately, most of the essential services such as plowing and trash pickup do not lend themselves to cost saving strategies for the consumer. If you’re in the market for a new home or apartment, consider reviewing any new fees assessed by the county of your potential residence to avoid costly bills or taxes.
- Water: Due to the same budget challenges mentioned above, cities across the a United States will be increasing the cost of water. Greater Chicago residents will see their bill increase as much as 25% in 2012, while the Denver market is set to rise an additional 5.5%. Strategy: Use less water. Here are 100 ways to consider.
- Gas: The average price of gasoline in the United States has risen every year since 2008. A preliminary report on 2012 gas prices from GasBuddy indicates prices may rise to close to $5 per gallon in some locations if conflict arises in Iran. The company’s 2012 projections will be released within the next two weeks. Strategy: Use a credit card which provide cash back for gas purchased. The American Express Blue Cash credit card offers up to 5% cash back for purchases at the pump.
- Shipping: The United States Postal Service (USPS) will raise rates by an average of 4.6% next year, while FedEx and UPS are increasing small package rates by 4.9%. Strategy: Amazon.com has the widest selection of products (millions of items) available online and two day shipping is free along with a paid Amazon Prime membership. Amazon is currently offering a free one month trial period if you sign up now.
It should not come as a surprise that prices increased this year. After all, it is the nature of prices to increase over the long term due to inflation. While it’s helpful to consider the strategies mentioned above, there are two simple strategies which will combat any price hike: make more money and spend less. Strive to implement these two strategies every year and you will be in a better position to absorb price fluctuations in the future.