Inflation has 67% of people dipping into their savings to pay for necessities, new survey reveals

LOS ANGELES (KABC) -- Inflation is at a 40-year high and it's now impacting people with a lower income.

A new survey found 67% of Americans are dipping into their savings to cover expenses.

"People are using savings and people do panic, and you know, a lot of people unfortunately are using their credit cards, and those are getting maxed out, especially with higher rates, those interest rates are outrageous right now," said financial expert Brian Gilder. "So there's a lot of uncertainty I think, in the economy, and a lot of people are panicking and their making decisions just to survive."

With a spike in the price of groceries, families are feeling the strain.

The U.S. Department of Agriculture says that as of April 2022, food prices were up 9.4% compared to April 2021. Gas jumped 50% over the last year as well.

"It's not as bad with groceries as it is with some things like fuel and auto, but it's definitely sticker shock," said Los Angeles resident Matthew.

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It's the biggest jump in inflation in four decades. The price of everything, from gas to groceries, is going up fast, and experts warn that price hikes have not peaked.

For millions looking at their retirement funds, there is also sticker shock. The S&P 500, which is tied to many 401(k)s, entered bear market territory yesterday. That means it's down 20% from the recent high. Experts don't believe things will improve any time soon.

"I think we will be inflationary times for a while I think you could make an argument that we're in a recession because of this happened with prices."

To slow down inflation, economists predict the Federal Reserve will raise interest rates by 3/4 of a point on Wednesday. That would be the steepest since 1994.