Retirees Are Paying 30% More for Groceries Than 6 Years Ago - Why They Could Go Higher This Winter
Grocery prices have remained steady last month according to the latest government figures. But that may be little comfort for retirees paying nearly 30% more for food than they did six years ago.
Some foods remain especially expensive, and even the Social Security increase coming next year may not provide much breathing room in retirees' grocery budgets.
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Here's why the latest numbers may sound more encouraging than what older Americans are experiencing at the supermarket.
The Price Gap
Grocery prices fell 0.1% in September, according to the Bureau of Labor Statistics.
But researchers at the Center for American Progress found that grocery prices have actually risen by 30%, citing federal inflation data. That means that a cart of groceries that cost $100 six years ago would cost about $130 today.
Michael Klein, a professor of international economic affairs at Tufts University, said people tend to compare today's prices with what they remember normally paying, rather than with last month's prices.
“With ongoing inflation, prices rise and the perception of unaffordability becomes more acute,” Klein said.
What Prices Actually Do
The way the Bureau of Labor Statistics’ Consumer Price Index (CPI) measures price changes can also explain why your grocery bill doesn't seem to match government inflation reports.
The CPI tracks average price changes across food categories, not what every item costs. In September, fruits and vegetables rose 0.5%, while beef fell 1% and dairy fell 0.9%.
Actual dollar prices tell another part of the story. Ground chuck averaged $6.48 per pound in September, down 29 cents from August. But in September 2020, it cost roughly $4.17 per pound—about $2.32 less than today.
The government reports changes in prices, but shoppers pay actual prices. A 29-cent drop in ground beef may sound like good news, but you're still paying more than $2 extra per pound compared with six years ago.
Where Prices Are Rising
The USDA's September outlook projected average grocery prices to increase 2.4% this year compared to last. For example, beef and veal are projected to rise 9.4%, partly because beef production has declined.
Sugar and sweets are also projected to increase 6.6%. USDA says the increases have been concentrated in candy and chewing gum, including chocolate candy.
These increases don't mean every product will cost more. But they help explain why grocery bills can remain high even when overall food prices have stabilized. The USDA forecasts also reflect average prices for the year, not additional increases expected before December.
Smarter Food Substitutions
Higher grocery prices don't mean every item is climbing at the same pace.
The USDA's September outlook forecasts beef and veal up 9.4% in 2026, compared with 1% for poultry and 1.2% for pork.
Chicken or pork can replace beef in stews, soups and other regular meals. Eggs offer another protein option. USDA projects their average price will fall 29.4% this year as production recovers.
Dairy prices are expected to rise just 0.1%, making plain yogurt or milk worth considering for regular meals. Total, actual savings depend on local prices and what you buy.
Will the COLA Help?
Starting in January 2027, Social Security benefits will rise 3.6%. The average retired worker will receive roughly $75 more per month. Individual increases depend on current benefits.
To put that amount in context, households headed by someone 65 or older spent an average of $5,251 on groceries in 2024, or about $438 a month, according to federal spending data. That's an average across older households, not a measure of what every retiree spends.
The additional $75 represents about 17% of that monthly grocery figure. It's money that can help cover food costs, but it won't necessarily restore what years of higher prices have taken out of retirees' grocery budgets.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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