Why prices remain high even when inflation subsides
Personal finance reporter Daniel de Visse explains why cooling inflation still means rising prices, and why cumulative inflation continues to drive up costs.
Esther Malkin is dipping into her savings to pay rent. Mike Dedivitis used his retirement account to pay for repairs on his pickup. Kerrigan Rosado bakes bread to save a few dollars at the grocery store.
American consumers have a hard time remembering a time when inflation wasn’t on their minds.
Consumer prices have risen for the fifth consecutive year. Prices have increased by more than 25% during this time. In other words, a typical product that cost $100 in 2021 can now cost at least $125.
There is little relief on the horizon. The annual inflation rate in June was 3.5%, higher than the inflation rate for any month in 2025.
The inflation crisis began under President Joe Biden in the final months of the COVID-19 pandemic. This situation continued into President Donald Trump’s second term, supported by import tariffs and a protracted war with Iran.
USA TODAY asked six American consumers how they are coping with price increases. Here’s what they said:
“Everything is getting more expensive.”
Mike Dedivitis, 71, of Rainbow Lake, New York, and his wife take home about $4,500 a month between a full-time job as a historical interpreter, a part-time job as an environmental steward, and Social Security benefits.
They still financially support their daughter, who is a junior at Pittsburgh State University. Dedivitis said there is little room to save after paying fixed costs.
Dedivitis, a former postal worker, ended up having to withdraw $2,000 from his Thrift Savings retirement account because he needed $2,000 to repair his pickup truck.
Over the past year, the price of almost everything they buy has increased, he said. My electricity bill has more than doubled. However, their salaries have not increased.
“Car repair prices have become very high. Everything is getting more expensive, so the situation is only going to get tougher. At the moment we can’t afford to buy a new car,” he said.
They ate out less, eating out about once a month instead of once a week. They buy off-brand products and look for sales at grocery stores. Although they are driving less because of rising gas prices, Dedivitis said his wife still has to drive about 50 miles to and from work each day.
Dedivitis said it’s harder to make ends meet today than it was during the Great Recession.
“I don’t think we’re doing as well overall as a country,” Dedivitis said. “I think the economic situation is only going to get worse. I don’t have much faith that things will get better.”
$900,000 for condo (not including condo fee)
At a filling station near Mary Merkens’ home in Culver City, Calif., gas costs nearly $6 a gallon.
“I’m so grateful to be able to work remotely,” she said.
Mehrkens, 34, works as a YouTube news editor. Her husband is a product manager at a technology company. He commutes, but it’s not far.
They love their neighborhood, which she said is a luxury in L.A. “because we don’t drive a lot and we walk a lot.”
The couple’s biggest affordability challenge is housing. They have two good incomes. They want to buy a house, or at least a condo. But even a condo in Culver City costs “about $900,000,” not including the monthly condo fee, Merkens said.
“I saved up for a down payment, but it would be all gone,” she said. “And we also think about the possibility of layoffs.”
So they rent. Another big expense is childcare, which costs $1,600 a month for her 3-year-old daughter.
Merkens laughed as she recalled thinking that daycare might cost $500 during her pregnancy.
“My husband and I both have increased incomes, so we’re competing with prices,” she says.
Merkens said the cost of groceries also continues to rise, particularly for fresh produce and meat.
“We try not to eat overly processed foods, but it’s becoming very difficult to maintain that,” she said. “Right now, it feels like it’s almost cheaper to go to Chipotle than to buy groceries.”
Social Security doesn’t cover her housing costs.
Esther Malkin, 65, survived two layoffs before losing her job as a regional sales representative for a global food company two years ago.
She did not intend to retire so soon, but despite having been with the company for 25 years and having a long track record in corporate training and sales, she was unable to find a job.
Malkin, a local affordable housing and renter’s rights advocate, had offers to work for nonprofits over the years after leaving her corporate job, but those disappeared due to government budget cuts and other funding challenges.
At first, Malkin thought he was lucky. She was given 10 months of severance and health benefits until she became eligible for Medicare.
Her Social Security check doesn’t even cover the rent and utilities for her 750-square-foot home in Monterey, California. The rest will need to go into your own savings, 401(k), and a small pension.
“I used to say, ‘What do you mean, you’re on a fixed income? We all had a fixed income. If you have a paycheck, that’s your fixed income,'” she says. “But it’s different when you have a fixed income and Social Security doesn’t even cover your housing costs, let alone all your other expenses.”
Malkin can’t help but worry about the possibility of cuts to Social Security. Already, rising prices for everyday necessities like groceries, prescriptions and gasoline have forced her to live on far less.
No more vacations or eating out with friends. These days, getting out of the house means gardening, going to the gym, or volunteering at your local animal shelter.
For years, she dreamed of getting a dog when she retired, but now she can barely afford two cats.
Malkin, an East Coast native who moved to California more than 25 years ago and previously owned homes in Miami and Denver, said he has considered moving. But where will she go?
“At least before you had the option of going somewhere else that was more affordable,” she said. “That’s pretty much gone.”
Although her retirement isn’t what she imagined, she says she’s grateful that she’s better off than most.
“At the end of the day, if you have a lot of money in the stock market, you’ll be fine,” Malkin said. “Not everyone else is like that.”
“In the blink of an eye, your entire paycheck is gone.”
Kerrigan Rosado, 29, commutes an hour each way to work as an administrative assistant at Central Michigan University. Her husband drives 30 minutes to work helping people with disabilities.
Rosado told USA TODAY in April. At the time, she was spending $50 twice a week to fill the tank of her Chevrolet Equinox in her hometown of Saginaw, Michigan.
Gas prices still aren’t that low, and everything else seems to be getting more expensive.
“Our electricity rates are among the highest in the Midwest,” she said. “They keep increasing our prices, interest rates and distribution fees every year, and they keep saying it’s to improve the grid. … But our reliability hasn’t improved.”
Rosado estimates that she and her husband pay about $300 a month for electricity and gas, compared to “low $200” a few years ago.
Food is more expensive almost across the board, she said.
“A few years ago, a family-sized pack of chicken thighs was 99 cents per pound,” she says. “And now it’s $1.30.”
In recent months, she said, “When I go to the grocery store, I don’t spend much money, and I usually end up spending $100 and leaving the store.”
To cope with rising prices, Rosado said, “I’m buying more things in bulk. I’m cooking more at home. I’m making my own bread instead of buying it because it saves me a few pennies.”
And it all adds up.
“I feel like I could blink and my entire paycheck would be gone,” Rosado said.
“The price is insane!”
Groceries, gas, restaurants – prices are rising everywhere Chicago’s Krista Engel looks. “The prices are crazy!” she wrote in an email.
“Breakfast for two at a restaurant used to be $25, now it’s $50,” she says. “An extra-large cup of tea costs nearly $5. Bananas never go on sale.”
In modern times, good deeds come at a cost. Ms. Engel, 60, recently moved just outside Chicago’s city limits and found herself “even having to pay to receive furniture donations.”
To make ends meet, Engel said, the couple “eats more at home and treats themselves as much as possible. We shop more often so we only get what we need and don’t waste anything. We only buy things when they’re really on sale.”
But tightening the budget won’t ease the pressure. “I’m worried about my finances because the situation hasn’t improved,” Engel said. “I’m worried that the situation will get worse, but we have no control over it.”
Despite getting a raise about a year ago, “I’ve noticed a net increase, but it hasn’t kept up with the cost of living at all.”
Mesa grandma worries about rising medical costs for her family
When it comes to rising medical costs, Peg Kilroy, 74, of Mesa, Arizona, isn’t concerned about herself.
She has a private Medicare insurance plan through Blue Cross Blue Shield, which covers most of her costs.
But she worries about how her family will deal with health insurance and medical bills.
“I’m lucky to have access to medical care,” Kilroy said. “There are people younger than me who aren’t as lucky.”
Kilroy said her sister has an Affordable Care Act health insurance plan and the cost has more than doubled this year. The average cost for ACA members who want to keep their insurance plans rose 114% in 2026 after Congress failed to extend enhanced subsidies that expired at the end of 2025, according to KFF, a health policy nonprofit.
Less than half of adults say they can pay for medical bills, medical appointments and prescriptions, according to a June 18 West Health Gallup survey.
Kilroy said rising health insurance premiums and medical costs are too much for Americans who are dealing with rising inflation and soaring grocery costs.
“My nieces, nephews and grandchildren are all struggling,” Kilroy said.
