BIG UPDATE: Walmart has very good news for customers on a budget
According to The Street, Spring is the perfect time for self-reflection and clearing out both physical and mental clutter. Many of us will take part in traditional spring cleaning, whether it’s donating old clothes or organizing that messy space under the kitchen sink. But for the ambitious, spring is also a great time to clean up your finances. After the holiday spending spree, and with summer just around the corner, it’s the ideal season to reassess monthly expenses and see where your money is really going.
With inflation continuing to put pressure on household budgets, there’s no better time to evaluate your cash flow. The latest Consumer Price Index (CPI) shows prices rose by 3.1% over the past 12 months, surpassing analyst expectations of 2.9%.
Interest Rates and Inflation’s Daily Impact
Due to persistently high inflation, the Federal Reserve announced on Wednesday that it will hold interest rates steady for now. While interest rates might seem like a distant concern for those not in the market for a new home or car, many are already feeling the pinch of inflation in their everyday expenses.
Here’s a breakdown of how certain consumer goods and services changed in price recently:
- Food: up 0.4%
- Energy: up 0.5%
- New vehicles: stable at 0%
- Used vehicles: down 3.4%
- Apparel: down 0.7%
- Shelter: up 0.6%
- Transportation: up 1%
- Medical care services: up 0.7%
While a 0.4% increase in food prices may not seem like much, you’ll likely notice a difference in your grocery bill. Key items have become pricier compared to the previous year, with fresh fruit up 1.4%, cereals and bakery goods up 1.5%, and beef and veal soaring by 7.7%.
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Walmart’s Key Role in Helping Consumers Save
With prices rising across the board, many Americans are looking to Walmart (WMT) to stretch their grocery budgets. As the country’s largest retailer, Walmart reported $264 billion in U.S. grocery sales for 2023, commanding one in every four dollars spent at grocery stores. This figure is larger than Kroger, Costco, and Albertsons combined.
“We’re seeing more customers, we’re seeing them more often, and we’re seeing a lot of new customers,” Walmart U.S. CEO John Furner told analysts during a Q4 earnings call in February.
Walmart saw a 4% increase in comparable store sales during Q4, a key indicator of its performance compared to the previous year. The retailer’s online grocery business also grew rapidly, with many customers opting for delivery to save time and energy. Walmart’s paid membership service, Walmart+, has been a major driver of this growth, offering free delivery on grocery orders over $35.
“It has saved me hundreds of hours of time in the last year, and time is money,” one Reddit user shared on the r/Frugal subreddit. “I also save because I don’t impulse buy.”
Walmart’s Strategy to Keep Prices Low
As Walmart’s customer base grows, the company is working hard to retain these shoppers while also attracting new ones. In March, CEO Doug McMillon announced plans to lower the prices of certain food items back to pre-inflation levels, with some staples already seeing cuts.
“In food, prices are lower than a year ago in places like eggs, apples, and deli snacks, but higher in other places, like asparagus and blackberries,” McMillon noted. He added that while dry grocery and consumables such as paper goods are still up mid-single digits compared to last year, the company’s private-label offerings have seen increased demand as shoppers look for savings.
With rising costs impacting everyone, a little financial “spring cleaning” can go a long way in helping households manage their budgets more effectively.
