Latest / Inflation and Your Money with Fexingo: Protecting Purchasing Power and Beating Inflation / How Inflation Is Quietly Eating Your Streaming Service Value
Transcript
- Lucas: So the June CPI came in at 332.6 — headline inflation actually ticked down a bit from the previous month. But if you look under the hood, core services inflation is still running warmer than the Fed would like. And one category that's been quietly climbing? Streaming services. Luna: Streaming? I feel like every month there's a price hike somewhere. Netflix, Disney Plus, Amazon Prime — they all seem to go up a dollar or two every year. Lucas: Exactly. And it's not just the obvious ones. The typical household now subscribes to an average of four streaming services, and the combined bill has risen about 18 percent over the last two years. That's faster than headline inflation. Luna: Eighteen percent — that's significant. So even if the CPI says inflation is cooling, your personal inflation rate might still be high if you're heavy on subscriptions. Lucas: Right. The CPI basket includes a category for 'cable and satellite television and radio service' but streaming is lumped into a broader 'subscription services' bucket. The Bureau of Labor Statistics does track it, but it's not as transparent as something like gasoline or eggs. And the PCE index — which the Fed prefers — came in at 131.5 in May, up from 130.94. That's still showing upward pressure in services. Luna: And the Fed is watching core PCE even more closely. That hit 130.1 in May, also up. So the 'supercore' services inflation — which includes things like streaming, healthcare, rent — that's sticky. Lucas: Sticky is the right word. And with the Fed Funds rate sitting at 3.63 percent, and Dallas Fed President Logan just calling for modestly higher rates, the environment suggests that these service prices aren't going to roll over quickly. Luna: So what do we do as consumers? I mean, I'm not canceling everything, but I hate feeling like I'm overpaying. Lucas: Well, one approach is to do a subscription audit. Write down every service you're paying for, the monthly cost, and when you last watched it. If you haven't opened an app in three months, cancel it. You can always resubscribe later. Luna: That's practical. I've also started using a dedicated debit card just for streaming — that way I see all those charges in one place at the end of the month. It's eye-opening. Lucas: That's a great tip. Another strategy is to rotate. Binge what you want on one service for a month, then switch to another. You don't need all four simultaneously. Luna: And look, I know a lot of people feel like they're not getting the value they used to. But the thing is, from the companies' perspective, they're under pressure too — content costs are rising, and they're trying to get to profitability. Lucas: Right. Netflix's ad-supported tier is a direct response to that. They're trying to capture price-sensitive customers while still growing revenue per user. But it means the consumer has to be more deliberate about what they pay for. Luna: Yeah, I think being deliberate is the key word. And that actually connects to something I wanted to bring up — because we talk a lot about inflation eating into your purchasing power, and we try to give you actionable advice every episode. Lucas: Yeah? What's on your mind? Luna: Well, a handful of listeners have asked how we keep this show going without ads. And the honest answer is that a small group of listeners chips in monthly through Buy Me a Coffee — that's buy me a coffee dot com slash fexingo — and that literally funds us making this many episodes. Lucas: It's true. No sponsors, no annoying ad breaks. Just listener-supported, ad-free conversations. And we're grateful for everyone who's part of that. Luna: So if you've gotten value from any of our episodes — maybe you saved a few bucks on streaming after this one — that's exactly the kind of thing that keeps it going. Lucas: Alright, back to streaming. One more stat I want to highlight: the 10-year breakeven inflation rate — that's the market's expectation for average inflation over the next decade — is now at 2.24 percent, up slightly from 2.22 last week. So the bond market expects inflation to stay above the Fed's 2 percent target. Luna: That means we should probably keep an eye on our recurring expenses, because those small price increases add up over time. Lucas: Exactly. If you're paying $15 for a service, and it goes up by $2, that's a 13 percent increase — way above the official inflation rate. And if you don't notice, it's just quietly eating your budget. Luna: Okay, so let's recap for anyone tuning in: check your statements, cancel what you don't use, consider rotating, and maybe use a dedicated payment method to track spending. Lucas: And if you want to see the data behind our conversation, the CPI and PCE numbers are publicly available from the Bureau of Economic Analysis and the Bureau of Labor Statistics. We'll link to them in the show notes. Luna: Thanks for listening, everyone. We'll be back next time with another angle on how inflation is quietly affecting your money. Lucas: Take care.