Your taxes are going up in 2013. But turn that frown upside down. At least prices will be going up and your real wages will be going down. Sounds like a recipe for economic recovery. But don’t worry. The magicians at the BLS will adjust that inflation away so they can starve grandma by keeping her SS increase well below her cost increases.
12 Things That Will Be More Expensive in 2013
By Laura Heller, dealnews contributor
While we like to focus on saving money and falling prices, it’s important to recognize when certain items are, conversely, becoming more expensive. And unfortunately, consumers can expect select electronics, smartphones, cars, and food to cost more in the coming year. Thanks to mature technologies, a lack of innovation, higher prices for precious metals, added features, and a drought, 2013 looks like it will be just a little more costly.
Each year, we here at dealnews take a look at items that are expected to cost consumers more in the coming year, and it seems as if some prior trends are finally coming to an end – the price of gold may finally hit its peak in the next few months – while the cost of a college education is still on the rise. Luxury goods continue to command an ever-increasing premium, and one new hot commodity – copper – could be problematic for home owners and beer drinkers alike.
Fuel Efficiency Ratchets Up the Cost of Cars
Gas prices may be falling, but cars that run on it are getting more expensive. Earlier this year, the Obama administration issued new standards that require automakers improve fuel efficiency, and the cost of upgraded engines alone is driving up prices. Toyota hiked prices on its mid-size Camry by roughly $175, and among best selling luxury vehicles, the 2013 Lexus CT 200h will be almost $3,000 more than the 2012 model.
Grocery Prices to Increase by as Much as 4%
Meat, poultry, and dairy prices are all expected to rise thanks to this summer’s drought. Feed corn and grass were most effected, and the impact from their scarcity will soon be felt at the grocery store: price increases will hit right along with the new year. Since drought conditions forced farmers to reduce the size of their herds to combat higher feed costs, the price of beef and chicken is also slated to rise. The cost of dairy products, too, will be affected, as fewer and leaner cows produce less milk. Overall, the USDA expects food prices to rise 3.5% to 4% in 2013.
Grain Prices Affected by Drought
Cereal and bakery product prices will rise too, as a result of the 2012 drought and lower wheat yields. Prices in this category began creeping up in October, and the USDA’s Economic Research Service forecasts cereal and bakery product prices to rise 2.5% to 3.5% next year.
Health Care Premiums on the Rise
Obamacare not withstanding, employee health care premiums are expected to rise an average of 6% in 2013, according to Aon Hewitt, a human resource consulting firm. That amount will vary by state and type of plan, but overall, employers will face higher premiums and the increased cost will be passed along in part to employees.
High-End TVs and Home Theater Systems Hit New Highs
While there will always be budget home entertainment options, folks who want the latest and greatest in this department will face some shockingly high price tags in 2013. According to Jeff Joseph, spokesman for the Consumer Electronics Association, Ultra HD TVs — which include an extremely high pixel density — sell for $20,000 to $25,000. High-end audio manufacturers too aren’t holding back, as they incorporate premium features like Apple Airplay or standard DLNA that lets users control the entire system wirelessly. These features can drive up the cost of AV equipment in an instant.
Computers Push High-End Features
As tablets continue to gain momentum in the consumer electronics realm, computers are returning to their original function as work-related machines — albeit more powerful and expensive. According to Stephen Baker, vice president of industry analysis at The NPD Group, Apple’s new notebooks with retina displays are among the highest-priced models out there, and Microsoft’s latest operating system, Windows 8, is driving the adoption of premium touchscreen PCs.
Even geeks and gamers could see higher prices, as Intel plans to release processors that are soldered onto motherboards in 2013, rendering them un-upgradeable. This would make DIY upgrades to a desktop machine impossible, forcing the computer-savvy to opt for a custom configuration from the manufacturer, which is, as a general rule, more expensive then getting a deal on the boxed CPU and replacing it on your own.
Copper Will Be in Demand and Beer Prices Will Suffer
Move over gold, it’s copper’s time to shine! Copper prices could be on the rise thanks to a move by the SEC to approve a fund to trade the metal. The fund could lead to scarcity and higher prices, as it did for gold. The problem is that copper is used in plenty of consumer items, including residential water pipes, wire, pots, and kettles, as well as equipment for brewing beer, distilling liquor, and making candy.
Say Goobye to Subsidies for Smartphones
The U.S. smartphone market has long been subsidized by service providers, offering phones at reduced prices with the signing of long-term contracts. In 2013 T-Mobile will eliminate the subsidy and charge full price for its phones. While there’s evidence to suggest that the carrier will in turn allow users to opt for cheaper service rates (thus saving money in the long run), the pill of a full-price phone may be hard for many to swallow.
Services from Daily Deals Will Become Scarce
In spite of lots of bad press, the daily deal isn’t dead yet. It will, however, continue to evolve in 2013. Too many competitors and not enough profits are forcing these sites to focus more on product deals, lead by Groupon Goods. It therefore may become difficult to find deals on services. If you’re accustomed to scoring cheap spa vouchers, for example, it may become harder to find such discounts next year, as daily deal sites will list fewer such offers and instead opt for tangible products — leaving you to pay full-price for your indulgences.
Tuition Goes Up as States Can’t Subsidize University Expenditures
While tuition costs are always on the rise, state schools in particular are feeling the pinch. As education costs continue to increase, many states will no longer be able to subsidize much of its students’ tuition costs. Meanwhile, student aid and grants aren’t rising commensurate to costs, which means university expenditures — more administrators, new dorms, and additional property — will get passed along to students. Tuition and fees for private universities aren’t increasing as much in 2013 as they have in recent years, but they are expected to rise for public 4-year colleges. Students can expect in-state tuition to increase 4.8% and fees to rise 3.7%, according to the College Board Advocacy & Policy Center.
iPhone 5 Accessories Will Be Costlier Than Previous Generations
Although there have been several iterations of the iPhone at this point, one thing had remained the same for several years: the dock connector. Thus, unlike cases that are outdated with the slightest change in form factor, iPhone dock accessories remained largely universal across new models. But the iPhone 5 features a radically different Lightning connector, resulting in a fleet of brand new accessories that have no prior-generation alternatives — which means premium prices. These higher prices debuted in late 2012, and they will continue in 2013 until manufacturers begin releasing updates to these items.
Shipping Costs on the Rise
While somewhat unsurprising, 2013 will see a 4.5% to 4.9% hike in shipping costs from both UPS and FedEx, the latter of which is slated to raise rates beginning January 7. Higher shipping costs may affect customers who predominately shop from “independent” sellers, like those found on eBay, etsy, and the like, but it may also have an impact on retailers that presently offer free shipping. Since merchants end up paying for the handling and delivery of orders that “ship free,” the increased UPS and FedEx rates may affect the frequency of, and threshold at which, online orders receive free shipping in 2013.
Does all this talk about rising prices get you down? Be sure to shop wisely by setting up a dealnews email alert for the specific products and categories that are important to you, so you know immediately when we see a good deal. You can also stay tuned for next week’s followup to this piece that details things that will be less expensive in 2013.
Yojimbo says:
I would add ammunition to this list.
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29th December 2012 at 10:51 am
JIMSKI says:
Add auto repair to the list. After being stagnant from 08 to 10 the auto shops that made it through will be very busy and will be raising labor rates. We wil be raising basic by 10% and high line by 14%. We are now booked out at least 2 weeks for major service and our techs are averaging 60-75 billed hours in a 5 day work week. Want a good paying 8 to 5:30 job? You can make 60-75 k a year as an auto service technician in a well run shop.
Of course an extra value meal will soon be 14.95 so it is all relative…………
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29th December 2012 at 11:01 am
sangell says:
Ditto Cable TV. I lost the Golf Channel this month. About the only thing left in the standard cable package are pawn shop shows, tow truck shows, alligator wrestling shows and storage locker shows. My local PBS station spends half the year begging for money so there is little to watch there anymore either.
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29th December 2012 at 11:17 am
Administrator says:
JIMSKI
Is this because people are holding onto their cars longer, forcing them to get service done to make them last?
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29th December 2012 at 11:18 am
big Tom says:
buddy owns a repair shop and specializes in transmission repair. he is booked out several weeks as well. rates are slowly rising, he is having trouble hiring anyone both qualified and willing to show up and work. He also told me the number of people wanting to make payment arrangements increasing. it appears people are trying to keep the old junkers running as no money to buy something better, at least in my area of Iowa
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29th December 2012 at 1:35 pm
Micro-Be says:
In regards to autos – did not the infamous and now forgotten Cash for Clunkers drive up the prices of used cars as it created a shortage in supply? Pretty brilliant move, perhaps, in an effort to create demand for new autos, but from what I understand it had an unintended (or?) affect of raising the prices of all used autos.
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29th December 2012 at 2:18 pm
AKAnon says:
Admin-Yes. I am pretty sure that is the reason. Body shops are doing OK as well for the same reason. Mostly economy trying to nurse the older rigs along. Secondary motivation may be a few folks (most of whom are here on TBP) trying to keep the modern nanny-state technology out of their lives.
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29th December 2012 at 2:55 pm
IndenturedServant says:
I bought a side of beef, half a hog, one dozen chickens and three turkeys. All free range without hormones or antibiotics. My 20cf freezer is almost stuffed but I still have room for a halibut I intend to add to the inventory next year. We buy fresh, whole foods and make our own meals which results in zero dollars spent on prepared BS. I’ve been buying high purity, 10oz copper ingots throughout the year and saving my copper pennies. I already drive a 26 year old piece of shit Toyota that rarely ever breaks down and I do my own maintenance. No Iphones or Smartpnones for me. I am researching the my options regarding grains. I’d like to buy whole grain and mill it myself but I need to know more about storage etc. I already have a couple hundred pounds of rice and one hundred pounds of cornmeal. (corn bread is a staple at my house) I make my own beer or buy by the 1/5th barrel from local breweries for as little as $35 per 1/5th barrel. Keep it cold and under gas and it ages very well, if it lasts that long.
I’m not perfectly prepared, nor can I prepare for some things but dammit, I’m tryin’!
I_S
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29th December 2012 at 3:23 pm
JIMSKI says:
ADMIN
The average age of the us fleet of vehicles is the oldest in history. Part of that is due to vehicles being made better and part is that the cost of new vrs repairs is a very large spread. You average 100k miles vehicle will cost about 20% of a new car payment to keep on the road. This, of course, only works if you maintain the vehicle. We still see new customers from other shops where the vehicle at 90,000 miles is just fucking done. Dirty fluids, service lights on dash, bald ass tires from alignment or loose parts.
We have a customer with a 2001 Toyota pickup with 435,000 miles on it. Salesman for a chemical company who drives the shit out of it. Truck looks and drives new. He has spent about 8,000 bucks at our shop and that includes tires. Every last thing we have done has been maintenance. No repairs. No water pumps. Radiators. Fuel pumps. None of the stuff that fuckin breaks when you do not maintain your vehicle has been touched and he has had zero breakdowns.
Had an 05 maxima in with just over 100k in the shop Friday. Car is done. Trans fluid black no coolant in vehicle radiator burst. Drove it into overheat till it stopped. V6 all leather prolly cost 30k for this car new. Now it is worth 400 bucks scrap.
You are all going to ask so yes, it had an obama sticker on it.
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29th December 2012 at 3:45 pm
IndenturedServant says:
@JIMSKI,
Stories like that would make an interesting blog. My poor old 4Runner was abused in almost every way possible but the oil was changed regularly along with other filters and coolant. The previous owner used it for honest 4-wheelin’ and “rolled it gently” a couple of times. The passenger side is now all Bondo and rust. Mechanically the rig is “broke in” at 320,000 miles. Cosmetically, it’s a piece of shit. I doubt I could sell it for $500 but the damn thing won’t die.
A little money and time spent on maintenance saves you an enormous amount of money over the long run. I read on article the other day that made me laugh. It was about a tinkerers workshop where people could bring in broken items and be taught how to repair them. I was practically born fixing things. Sounds like it might be a nice little retirement plan I could do out of my garage. People will need the services of a good tinkerer in the not too distant future and I love tinkering!
I_S
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29th December 2012 at 6:30 pm
ecliptix543 says:
My newest vehicle (of the two) is an ’07, the other ’03. I will never buy a new car again and I’m not likely to ever buy anything newer than the ’07 due to the massive piles of mandated bullshit forcibly installed on them. Had I known my ’07 had the mandated tire pressure system on it, I’d have gotten an ’06 instead. What a fucking useless, nanny state hunk of shit that system is… all because some numbnuts out there refuse to acknowledge that tires have AIR in them and that air tends to leak over time.
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29th December 2012 at 10:03 pm