If your budget has been feeling a little tighter and your wallet a little thinner lately, you're not imagining things.
Higher prices are creeping up on consumers, and Americans will likely see cost hikes on everything from cell phone bills to orange juice this year. Meanwhile, take-home pay has barely grown, a trend that's not likely to change soon, experts say.
"That's bad news for households," says Joel Naroff, president and chief economist at Naroff Economic Advisors, a Pennsylvania-based economic consulting firm. "It means their purchasing power is continuing to be eroded."
Although Federal Reserve Chairman Ben Bernanke projected overall inflation to remain muted near the Fed's 2 percent target this year, Naroff isn't so sure recent economic indicators support that. The labor market is improving and economic growth is picking up, both of which increase demand for goods and services and put upward pressure on prices.
"Don't be surprised if most of the goods people buy, whether it's services or goods, that inflation will be moving up a little more than expected," he says.
Here's a look at what's likely to be more expensive in coming months:
Gasoline. Tensions in the Middle East and refinery closures in the States will put extra pressure on gas prices this year, with some experts predicting costs to rise as much as 60 cents by Memorial Day. Urban dwellers will likely take the brunt of the price increases according to Gasbuddy.com, which projects fuel costs flirting with $5 per gallon in places like Chicago, Los Angeles, and New York City.
Not only does that hit consumers in the pocket at the pump, higher fuel prices get worked into to pretty much everything that needs energy to produce and transport.
Computers. It might seem a world away, but catastrophic flooding in Thailand last year will likely impact the price you pay for a new laptop or desktop computer. That's because Thailand is a major manufacturer of hard drives, and the fallout from the floods has thrown a wrench into supply chains for electronics manufacturers, making hard drives scarcer and more expensive.
Actual list prices might not be higher, says Dan de Grandpre, CEO and editor-in-chief of consumer news website dealnews.com, but retailers will probably cut back on offering discounts, deals, and bundles. "There's just this huge lag from all the problems of the cost of hard drives going up," he adds.
De Grandpre suggests waiting until August or September to make a computer purchase, when retailers are likely to ramp up back-to-school promotions.
Taxes and tickets. Years after the Great Recession was declared over, many states' and cities' balance sheets are still wrecked. To fill huge budget shortfalls, some local governments are upping the costs for parking tickets and other traffic violations.
According to de Grandpre, Portland recently raised its parking fines 18 percent to cover the city's multi-million dollar deficit. New York City is also raising its city taxes to pull in some extra cash, he says.
"When [parking fines] go from $20 to $50 to $100, it seems excessive," he says. "But it's a way for cities to make that revenue deficit back."
Cell phone bills. If you aren't already on an unlimited data plan, don't expect to hop on one now. Given how most of us are glued to our smart phones all the time, most mobile carriers have done away with unlimited access in favor of tiered data plans.
"We saw previously Verizon and AT&T would offer the unbeatable packaged deals," says Andrea Woroch, a consumer and money-saving expert for Kinoli Inc. "Now if you're aren't grandfathered into the plan, those have gone away and you are going to be paying more for usage. There are a few big carriers, so they have the opportunity to do that unfortunately."
But you're not completely at the mercy of Big Telecomm. There are tons of free texting apps for smart phones, Woroch says, which can help make your monthly bill a bit less frightening.