The state stimulus checks have been going out to residents for close to a year. in the absence of federal support, the payments have been of much help to Americans besieged by the relentless rise in prices as inflation stays at close to 4 times the normal level.
Although the American Bureau of Labor Statistics revealed that the unemployment rate dipped to 3.5% by September, inflation persists at a 4-decade high for close to a year. it even rose to 9.1% in June and hasn’t gone down below the 8% mark year-on-year for much of 2022. Stimulus Check Stimulus Check Stimulus Check
It forced many families to fall back on the economic austerity of the post-pandemic months. It was even worse in some cases as they did not have the support of the federal stimulus checks to fall back on. Despite the IRS taking steps that could mean lesser tax rates for low and moderate-income families next year, the federal government stayed away from any form of stimulus checks in 2022.
To compensate for this gap, and realize the predicament of residents, around 20 states sent out stimulus check relief to residents. The payments are not on the scale of the federal economic impact payments but they have helped individuals and families struggling to put food on the table, pay their taxes, and prevent being evicted from their homes for non-payment of rent and mortgages.
Many families were saved from being marked out as loan defaulters. Surging inflation led to an unprecedented spike in prices for everyday items from gasoline to groceries and the increase has been relentless for the past few months. This change forced families to reevaluate their budgets and become more cautious of their expenses.
The October price index, a measure of changes in the price of food, housing, utilities, gasoline, and various other goods and services rose by 7.7% over the past 12 months. It remains the highest since the early eighties. For those who travel a lot more for work, the expenses for gasoline alone work out too much for low and middle-class families. The rising cost of essential food items and other grocery stapes is forcing people to change their weekly grocery planning. Stimulus Check
Despite not making many changes in their grocery budget, people are being forced to make drastic cuts in their expenses to cope. Products and services that are a regular feature have seen a marked increase in prices and is affected most budgets. People are constantly having to adjust and take a look at how prices and costs have changed and are affecting their budgets.
Inflation is affecting everyone, but low-income households are the worst affected and are feeling the pinch even more, especially as the increase in wages for many workers has miserably failed to keep up with inflation. This has resulted in a negative gain for many after the pandemic. for the first time in decades. Americans are facing negative growth in wages despite a rise in wages across the spectrum.
Higher prices for consumer goods and services have meant that there is little room for discretionary spending and many individuals and families are having to shift their budgets just to cop with the bare necessities. People were again forced to revert to living paycheck to paycheck. People had to adjust for every expense and cut down on non-essential expenses to make up for it
The aftershocks of the COVID-19 pandemic were a shock to the world economy and severely disrupted supply chains and contributed to major delays in the shipping of goods. The surging consumer demand coupled with severe labor shortages only exacerbated the problems.
Many items continue to be in short supply as one of America’s major suppliers, China, continues to battle the virus, with millions of infections reported in a single day. This has adversely affected prices and it continues to rise every month.
Energy prices are up by 17.6% and gasoline alone is up nearly 17.5% over the last year. the situation is worse in California which has to also contend with a shortage of fuel caused by refineries in the state shutdown for maintenance. This has further affected prices.
Even the prices of used vehicles are up by 4.1% over last year and the price of new vehicles is up by 8.4%. food prices are also up by 10.9% year-over-year.
But the present supply chain disruption that is fueling much of the present inflation is not expected to continue for long. the Federal Reserve and other experts contend that inflation is more temporary that a long-term issue. Economists say that the inflationary environment is not going to last forever. He says it has more of a fear factor The resolution of the supply chain issues will cause prices to drop in many sectors.
But that Stimulus Check is little consolation for families tied down on a tight budget with sparse room to maneuver. Talks of economic cycles mean little to the person who has to face the immediate task of providing for his family and ensuring that they can pay off their debts on time.
Economists have not been able to reliably predict how quickly global prices will return to normal. It will depend on how soon the global supply chain gets back on track.
State Stimulus Checks Go Towards Immediate Crisis Expenses
Much of the state stimulus checks over the past year have been consumed by an increase in prices, and it is not limited to just gasoline and food. Even living expenses have gone up drastically say, finance analysts.
Inflation is affecting your bottom line in some shape and form and people must go for some simple changes in their budget and spending habits to account for the price rise over the next several months.
Some self-awareness and planning around family expenses could help people come up with opportunities to save. For those who do not have a budget, it is a good time to start one.
With federal stimulus checks on hold for the present, little can be expected to change in 2023 as the Republicans have gained control of the House. This will further tie down President Biden and people have to learn to live without more stimulus checks for now.
