Why Your Wallet Still Feels Lighter: Inflation, What Rose the Most Since COVID, and Why Things Still Feel Expensive
It may seem like inflation has slowed down — and in many ways, it has. But if you open your grocery bill, your car insurance statement, or your heating bill, you might still feel like you’re paying more than you used to. That’s because some goods and services have soared much more than the overall inflation rate. Let’s unpack what’s happening, what items rose the most since the start of the pandemic, and why your everyday costs still sting.
A quick refresher: what is inflation, and where are we now?
Inflation is simply the rate at which the general level of prices for goods and services goes up. After the height of the pandemic and the economy’s reopening, the U.S. saw historic inflation — driven by supply-chain disruptions, energy and food cost shocks, and labor-market stress. Now, inflation has come down from its peak, moving closer to a 3% annual rate instead of the higher levels seen in 2021–2022. But even though the average inflation rate is moderating, the “average” doesn’t tell the whole story — some items jumped far more than others.
Which goods and services have jumped the most since COVID?
Here are several examples of items whose prices have risen sharply from early 2020 to today:
- Eggs: up about 86.5%
- Frozen juices and drinks: up about 62.7%
- Motor vehicle repair: up about 58.4%
- Motor vehicle insurance: up about 56.6%
- Margarine: up about 56.6%
- Utility gas service: up about 54%
- Uncooked beef roasts: up about 53.2%
Many household product categories also increased more than 20% during this time. These are major increases — especially in categories people depend on daily.
Why did these items rise so much?
There are a few major drivers:
1. Supply chain disruptions
Factories shut down, shipping routes clogged, and raw materials became harder to source. When supply drops and demand rises, prices jump.
2. Energy, food, and commodity spikes
When energy prices rise, transportation and production costs increase for almost everything else. Food and utility categories reflect these pressures.
3. Labor and service-sector costs
Services like car repair and insurance rose sharply because labor, materials, and replacement parts became more expensive.
4. “Base effects”
Because prices jumped so dramatically in 2021–2022, today’s prices are being measured on top of those already-elevated levels.
5. Sticky prices
Some companies are slow to reduce prices even when their costs fall. Prices often stay higher to protect margins or hedge against future volatility.
Why do things still feel expensive even though inflation is moderating?
Even with inflation cooling, several factors make everyday life feel costly:
- Cumulative increases matter. Even with inflation at 3% today, many items are already 50% or more above their 2020 level.
- Essentials rose the most. Food, utilities, repairs, and insurance make up a big share of most families’ budgets.
- Reference points stick. People remember pren2020 prices, and the difference is noticeable on every shopping trip.
- Income growth may not match price growth. If wages haven’t kept pace, the financial squeeze feelsworse.
- Housing and service inflation remain high. Even if goods get cheaper, rent, insurance, and services keep pressure on budgets.
- Expectations shape behavior. When people expect higher prices, the feeling of cost pressure lingers.
What this means for your financial planning
For households, these trends can guide better planning:
- Review budget categories with the highest increases — especially food, utilities, insurance, and repairs.
- Adjust inflation assumptions in long-term projections. Your personal inflation rate may be higher than the national average.
- Time major purchases strategically depending on price trends.
- Watch shelter and service inflation closely — they drive most long-term budget pressure.
- Think clearly about inflation expectations — slowing inflation does not mean falling prices.
The Bottom Line
Inflation is coming down from its pandemic0era peak, but the financial pressure remains. Many everyday essentials have risen 50–80% since early 2020. Even if the overall inflation rate is now moderate, the cumulative increases explain why life still feels expensive. Understanding which items rose the most — and how that affects your personal spending — is key to staying financially grounded and planning effectively for the years ahead.
Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Advisory services offered through Cambridge, a Registered Investment Advisor. Sound Foundation Wealth Advisors and Cambridge Investment Research, Inc. are not affiliated.
