Life's Necessities Could Cost You $3,794 More in 2013

×
Whole Foods Market
"The only things certain in life are death and taxes."
-- Benjamin Franklin

Actually, make that death, taxes, and inflation.

Surveying the raft of end-of-year surveys floating around right now, it quickly becomes apparent that not only are our taxes set to rise in 2013, but the cost of a whole lot of other stuff is going up, too. The question is: How much more expensive will life get in the new year? Here are the grim statistics.

Food: $480
According to the U.S. Department of Agriculture's Center for Nutrition Policy and Promotion, your average American family of four spent $236.60 a week on groceries in 2012, roughly $1,000 a month. Thanks in large part to this past summer's drought, that number will rise in 2013.

The USDA estimates that grain prices will be about 3% higher in the new year. Add in the cost of converting grain to meat and dairy products, and food items could take an even bigger bite out of your budget. When all's said and done, expect your grocery bill to go up about 4% in the new year. Call it $40 a month.

Health care: $247
The Kaiser Family Foundation estimates that this same average U.S. family of four spent about $4,129 on health insurance premiums in 2012. Other researchers estimate we spent an average of $962 on top of those premiums, in out-of-pocket spending (OOPS) on medical costs.

Even if you're an optimist, though, and assume those OOPS costs hold steady in 2013, benefits analyst Aon Hewitt says you should expect a 6% hike in the cost of employee health care premiums alone: an extra $247, give or take (more likely taken), out of your paycheck.

Getting around: $3,000
Getting to work these days generally requires the use of a car. And whether your ride is a Tesla (TSLA) Model S, a me-too electric like the Lexus CT 200h, or even a humdrum Hyundai, expect higher sticker prices in the new year.

Tesla's bumping the price of its flagship electro-sedan a cool $2,500 to $59,900 in 2013. The cheaper 2013 Lexus is rising nearly $3,000 in price. Meanwhile, the $2,000 price hike at Hyundai -- the "econobox" car company -- represents a staggering 16% price hike to $14,545. Of the three, Lexus' buggy sells closest to the 2012 average cost of a new car -- $30,748. So don't be surprised if many of the cars you window-shop this new year cost about $3,000 more than they used to.

Computing costs: $20
It's hard to live in this modern world without the Internet and a computer to connect you to it. Unfortunately, Microsoft (MSFT) knows that, and it's probably why Mr. Softy feels it can safely raise prices on its latest edition of Microsoft Office by as much as 17% in 2013.

Next year, expect an Office Home & Student 2013 disk containing Word, Excel, PowerPoint, and OneNote to set you back $140 -- $20 more than Office 2010 did last year. If you need the more powerful Office Home & Business 2013 suite, that'll come with a similar $20 bump (to $220).

Everything else: $47
These days, it seems most everyone buys most everything online. That's bad news for two reasons. First, the more sales tax deals Amazon.com (AMZN) signs with several states, the more likely you are to get hit with higher transaction costs on online purchases. And that's just the start. After you've bought an item online, you still have to get it shipped.

That's particularly distressing, because in December, both FedEx (FDX) and UPS (UPS) announced they're raising rates. FedEx says it's hiking the cost of shipping via FedEx Express by 3.9% on Jan. 7, and upping the cost of FedEx Ground service by 4.9%. Taking its cue, UPS said it will raise its own UPS Air rates 4.5%, and UPS Ground will cost 4.9% more.

Now consider that InternetRetailer.com estimated that the average consumer spent about $1,207 online in 2012. Consider further that although many online stores advertise their goods as coming with "free shipping," there's rarely such a thing as a free lunch. Generally speaking, when an e-tailer says it will ship something "for free," it means the shipping cost has been built into the item's price. That being the case, online shopping in 2013 could conceivably cost you $47 more than it did last year... just to guarantee FedEx and UPS their Christmas bonus.

Motley Fool contributor Rich Smith thinks higher taxes and more inflation are still better than the alternative. Slightly. The Motley Fool owns shares of Amazon.com, Microsoft, and Tesla Motors. Motley Fool newsletter services recommend Amazon.com, FedEx, Microsoft, Tesla Motors , and United Parcel Service.

Increase your money and finance knowledge from home

Timing Your Spending

How to pay less by changing when you purchase.

View Course »

How to Avoid Financial Scams

Avoid getting duped by financial scams.

View Course »

Add a Comment

*0 / 3000 Character Maximum

23 Comments

Filter by:
zebra365

The AIER (American Institute for Economic Research) a non-partisan nonprofit has instituted an Everyday Price Index which is more representative of the American Consumer experience (and not skewed by a government that pays COLAs and interest on TIPs) than the CPI.

January 06 2013 at 1:41 AM Report abuse rate up rate down Reply
vlady1000

So if the avg family's take home pay is $70K/yr, that is 5.4% inflation. But wait, now add the increase cost of everythying else you have to buy (utillities, taxes, education, vacation, fuel for the car, etc, etc). it would be more like 7-8%. Although the avg person does not buy a new car every year (as the article assumes). The gov's published CPI, is a tanted number.

January 02 2013 at 10:50 PM Report abuse rate up rate down Reply
conyers

WHAT'S UP

January 02 2013 at 8:01 PM Report abuse rate up rate down Reply
1 reply to conyers's comment
coochiescooter

Gas , Groceries , Taxes

January 03 2013 at 2:41 AM Report abuse rate up rate down Reply
audioknot1

Typical Montley Fool gloom and doom fantasies. The economy is starting to kick into high gear because of President Obama. One of the greatest Presidents in U.S. history.

January 02 2013 at 7:07 PM Report abuse -2 rate up rate down Reply
2 replies to audioknot1's comment
ED

What did that fantasy have to do with this article?

January 02 2013 at 7:43 PM Report abuse +1 rate up rate down Reply
coochiescooter

Idiot

January 03 2013 at 2:13 AM Report abuse +1 rate up rate down Reply
ectullis

Why Life's Necessities Could Cost You $3,794 More This Year. Speak for yourself, I'm one of the 47%

January 02 2013 at 6:37 PM Report abuse rate up rate down Reply
donhellbound

i'd be happy to make what i made in the 80s,soon i'm gonna have to smash people in the head with a hammer and take there wallets,hell if i go to prison free health care yes that includes dental,free room and board not as bad as you think unless your a punk or mess with kids and free food,better than food you cant afford.

January 02 2013 at 6:25 PM Report abuse rate up rate down Reply
paddleman1928

good thing inflation, according to the gov't) is staying at about 2%

January 02 2013 at 3:19 PM Report abuse rate up rate down Reply
kendrak432321

The $3,794 in the headline assumes that people buy a new car every single year. How is that a necessity?

January 02 2013 at 1:48 PM Report abuse rate up rate down Reply
1 reply to kendrak432321's comment
cslinz62

You mean a car isn't a necessity? Rich people can afford a new car every year. By doing that, it's cheaper to lease.

January 02 2013 at 2:32 PM Report abuse rate up rate down Reply
delawaredude4u

I'm beginning to understand what Obama meant by "hope and change". When you go food shopping, there's very little 'hope' that you will leave the store with any 'change'.

January 02 2013 at 12:52 PM Report abuse +4 rate up rate down Reply
Ron

On shipping costs, why did they leave out the number one shipper the USPO ! " If it fits it ships" works for me and they didn"t raise there rates.

January 02 2013 at 12:45 PM Report abuse +1 rate up rate down Reply