ROCHESTER, N.Y. – With inflation on the rise, budgeting has become more crucial than ever. The Yale Budget Lab estimated that tariffs could cost the average American household an additional $3,800 annually for everyday essentials. This increase highlights the importance of maintaining a budget.

Tariffs could lead to higher prices for groceries such as fruit, cheese, nuts, rice, and seafood. Even a chocolate bar at the checkout line could cost more, as the U.S. imports nearly all its cocoa beans.

Coffee lovers may also face price hikes. The Starbucks CEO acknowledged that prices are likely to rise since the U.S. imports nearly all its coffee.

Retail giants like Walmart and Target could be affected too, as much of their clothing is manufactured in countries like Vietnam, China, and Bangladesh.

Personal finance expert and CEO of Invessent, Jarrett Felton, emphasized the importance of budgeting.

“First and foremost, I want to debunk any myths that budgets are for poor people,” Felton said. “And I want to debunk any myths that it’s just for blue collar or for people who make a certain amount.”

Felton advised starting by logging into bank accounts.

“Number one you write down only what you see,” Felton said. “Not what you feel. Not how you think you’re going to do better next month. Write down only what you see.”

He suggested reviewing credit card statements for three months to get a realistic picture of spending.

“Pull those bank account statements out and take a look to see what was direct deposited,” Felton said.

If spending exceeds income, Felton recommended identifying unnecessary expenses.

“That’s when you go in,” Felton said. “Scrub in. Scalpel. And go in and figure out – memberships or apps that you’re being charged for that you don’t need that you can get rid of.”

With tariffs potentially adding $3,800 annually to household expenses, families may need to find an extra $316 monthly in their budgets. Many apps can help with budgeting. Click here for app suggestions from the Wall Street Journal’s consumer section. Click here for NerdWallet’s suggestions. And for recommendations from Forbes, click here.

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