There are some things that will cost the same or less this year than in 2013. One of the things expected to cost less is coffee. Used cars are also expected to cost less as is oil (think gasoline) and 3D printers. On the other hand there are 10 things that will definitely cost you more in 2014.
1. Your mail
Once again the Postal Service is increasing the cost of stamps. On January 26, the cost will go from $.46 to $.49. This is the biggest increase in years. It’s supposed to be temporary — to help the Postal Service offset some of the losses it suffered during the Great Recession. In 2012,the agency lost $16 billion and $5 billion in the last fiscal year. The cost of shipping packages is also expected to increase this year as FedEx, UPS and the Postal Service all plan to increase their rates.
If you want to save on mailing costs, you might want to stock up on those Forever stamps before the price increase.
2. Nuts
There was a reduced crop this past year and a huge increase in consumer demand. This means that you may see sky-high prices for one of your favorite snacks. There was a wet and cold winter in the US and heavy rains and frost during Spain’s best growing season. This hurt worldwide almond supplies. In addition, pistachio crops were smaller. In general, wholesale seed and nut prices were up 9% through the first 11 months of 2013. This could translate into even higher prices as suppliers pass the extra cost on to us consumers.
3. Rents
Housing costs are expected to increase in 2014 and so are rents. One research firm has predicted that apartment rates will rise 3.1% nationwide from last year’s average of $1107 a month or even more if employment picks up. In hot real estate markets such as California’s Bay Area, Portland and Seattle rents are expected to jump the most as all three of these areas are benefiting from strong job markets.
4. A house
While home prices won’t surge as they did in 2013, they are expected to increase by about 5% this year. Unfortunately, in tandem with this, the cost of borrowing will be more expensive. Last year mortgage rates were at historic lows but the interest rates on 30-year fixed-rate mortgages have already gone up about 1% to around 4.5%. What this translates into is that for every $100,000 you borrow in a 30-year fixed rate mortgage, you’ll pay an additional $60 a month. Given the fact that the Federal Reserve is starting to slow down its monthly bond purchases, rates are expected to push upward. They could even be pushed higher if our economy continues to strengthen.
5. Honey
If you love honey be aware that there was an increase in prices towards the end of 2013 so you’ll be paying more money for that sweet stuff this year. This was caused by poor weather conditions and the fact that bee populations are dwindling due to Colony Collapse Disorder. This has dramatically reduced US honey production in recent years. However, consumer demand has continued to grow, which has pushed prices up. As an example of this, in December of last year the average retail price for honey was $6.04 a pound or up nearly 7%. In addition, many US beekeepers believe that they will be sold out of honey early this year, which will likely keep prices high throughout all of 2014.
6. Chocolate
There’s more bad news for people who have a sweet tooth. Cocoa prices are continuing to rise so that you may have to pay more for your favorite candy bar. The reason for this is a growing demand in new markets along with the bad weather that occurred in some of the major cocoa producing areas. This has created a supply problem as the worldwide production of cocoa fell by 3.7% during the 2012-2013 crop year. And this year’s crop is expected to be even smaller. Those crafty candy companies may shrink their products’ sizes or reduce their candy’s cocoa content as a way to absorb their increasing cost. However, it is expected that chocolate prices will still go up by around 3%. And those who love dark chocolate will be hit the hardest because smaller companies typically make these candies plus they require more cocoa. This means many of these companies will struggle to absorb the rising cost.
7. Satellite TV
Satellite TV bills will go up again in 2014. This is because both Dish Network and DirecTV have said they will boost the prices for almost all of their packages from $2 to $5 a month. The reason these two companies say they need to increase prices is because the television networks have increased the fees they are charged for programming. If you’re a Dish subscriber, you’ll see this change on your January bill while Direct TV’s increase won’t take effect until February.
8. Public transportation
Commuters in some major cities will be paying more this year for public transportation. As an example of this, fares for the Metro North’s New Haven line just increased by 5% on January 1. If you commute from, say, Bridgeport, Connecticut to New York City, you’ll pay about $20 more for a monthly pass. Do you ride BART (the Bay Area Rapid Transit system)? If so you saw an increase of 5.2% on January 1. The Washington DC Metro has proposed an average fare hike of 3%, which if approved will go into effect on July 1. Regardless of where you live you will pay more for your public transportation as a result of a shrinking tax break. While you were able to set aside $245 a month in pretax money last year, this will shrink $230. This could mean that your annual commuting costs might increase by up to $1380 a year.
9. Health care
Most Americans will be paying more for their health care despite the fact that Obamacare may finally be in full swing. If you are the member of a large employer-sponsored plan, your premiums will probably rise by as much as 7%. This is in comparison to the roughly 3.3% increase that occurred in 2013. If you add up all out-of-pocket expenses including deductibles and co-pays, the average employee costs are expected to reach nearly $5000, which is up almost 150% from 10 years ago. One reason for this is that more and more of the cost of healthcare is being transferred to employees and this is expected to continue in the future.
If you wonder why our health care costs so much, watch the following video for some answers.
10. Taxes
On December 31 dozens of tax credits and benefits expired. This included everything from the supplies that teachers purchase to energy-efficient home improvements. It’s possible that some or all of these tax breaks will be reinstituted by Congress but don’t count on it. In addition, the tax penalty for those who don’t enroll in health insurance for 2014 also takes effect under the Affordable Care Act. If you can’t prove that you are the member of a qualified health care plan, you will be required to pay a fine of $95 or 1% of your income, whichever is higher. The only good news is that you will not have to pay this penalty until you file your taxes in April 2015.