Low-Income Families Pay More for Everyday Items

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A recent study from the University of Michigan’s Ross School of Business, low-income families pay more for everyday items due to an inability to buy these products in bulk. As reported by CNN, researchers analyzed among the purchases of over 100,000 household items over the course of seven years.

It was determined that low-income families were less able to afford the higher upfront cost of buying items in bulk rather than households with higher incomes. Two-thirds of U.S. Latino children live in low-income households and about one-third live in poverty.

One of the key products studied was the purchase of toilet paper. In studying this trend, it was observed that 36 rolls of two-ply toilet paper might cost $15, but a roll of one-ply cost only $1. Researchers found that low-income households, those making less than $20,000 a year, made just 28.3% of their toilet paper purchases on sale while families making $100,000 took advantage of sales nearly 40% of the time.

“Our findings suggest it’s not that poor households can’t do the math or are financially inept,” said Yesim Orhun, one of the lead authors of the report. “They can be frugal. They take the better deal, when the can afford to.”

Buying cheaper brands was one way that low-income families tried to save money. During the first week of each month, families were more likely to take advantage of deals and purchase bulk items. Orhun found out that most other items can be bought and stored in bulk, such as dish soap, laundry detergent and good goods such as rice and beans.

Low-income families can’t always afford or don’t’ have access to these bulk or sale items, according to the report.

Read more about the report here.

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