Cost Of Living Today versus 30 years ago

[Planogirl]

Thirty years ago, my parents had to travel almost exclusively via car because they could not afford airfare. There weren't any discount airlines. And there wasn't any internet for comparison shopping. My Mom said that cross-country flights were a minimum of $1000 per seat. Now, I can fly cross-country for $300 per person. I can find a decent (clean, safe) hotel in most vacation destinations for $100-$200 per night, which seems perfectly reasonable to me.

If it's harder to travel, that's probably because more people are traveling than traveled 30 years ago.

30 years ago, a vacation was a trip to Grandma's house or to go camping in a tent. Today, a vacation is 7 nights at DisneyWorld or a 10 night cruise in the Caribbean. (Using actual examples comparing my childhood vacations to my family's vacations this year.)

I'm judging by my mother who travelled to Europe several times when I was a child. She did often go stay in the passenger section of freighters though depending on prices.

I admit that flying costs are not bad. I think that hotel, restaurant and admission costs have gone up considerably in many areas. Besides the Polynesian Resort was even affordable at one time.

As for buying a car on credit being a choice, I don't necessarily agree either. I definitely run my cars into the ground and only get another car when it becomes too expensive to repair my old car. I doubt that I'd ever be able to save enough to buy a car with cash, even a used one.

 

[cardaway]

As for buying a car on credit being a choice, I don't necessarily agree either. I definitely run my cars into the ground and only get another car when it becomes too expensive to repair my old car. I doubt that I'd ever be able to save enough to buy a car with cash, even a used one.

But even if it isn't a choice, how is it different than 30 years ago?

 

[Miss Jasmine]

Interesting thread.

I think there are more "luxuries" today that people consider "necessities". I believe that today many feel they are entitled to certain luxuries...cable and high speed internet being the biggest examples. Looking at how my parents lived and my grandparents lived 30 years ago, I feel I am in a much better position than they were (of course I was only two then, so I am going by what I have been told).

It is about making choices...instead of vacations, you could put that money toward a car fund, home downpayment fund, retirement fund, etc. After college, I worked a full-time and part-time job. All the money I earned from my part-time job I put into savings. It ended up being the downpayment for our home. Sure, I could have bought more clothes, ate out more, went on more vacations, bought a newer car, but I chose to make that my downpayment fund. That was one of the best choices I ever made.

 

[Galahad]

Interesting thread.

I think there are more "luxuries" today that people consider "necessities". I believe that today many feel they are entitled to certain luxuries...cable and high speed internet being the biggest examples. Looking at how my parents lived and my grandparents lived 30 years ago, I feel I am in a much better position than they were (of course I was only two then, so I am going by what I have been told).

It is about making choices...instead of vacations, you could put that money toward a car fund, home downpayment fund, retirement fund, etc. After college, I worked a full-time and part-time job. All the money I earned from my part-time job I put into savings. It ended up being the downpayment for our home. Sure, I could have bought more clothes, ate out more, went on more vacations, bought a newer car, but I chose to make that my downpayment fund. That was one of the best choices I ever made.

I'll bet very few of us in the middle class would be at all satisfied with a 1970's life today.

 

[boomhauer]

But even if it isn't a choice, how is it different than 30 years ago?

Like the cost of rent.

30 years ago, my dad bought his first brand new car for $1,995. The average price of a midsize car same style today is $18,000. My dad made $10,400 when he bought that car.

Rest assured, I don't make $93,000 a year.

 

[Miss Jasmine]

I'll bet very few of us in the middle class would be at all satisfied with a 1970's life today.

By better position, I don't mean "things". I mean looking at my net worth and my future possibilities, I think I am in a better position.

 

[Bob Slydell]

Like the cost of rent.

30 years ago, my dad bought his first brand new car for $1,995. The average price of a midsize car same style today is $18,000. As I've said before, I don't make 10x what my dad made 30 years ago.

Inflation isn't a linear formula -- you don't just take the cost of something and multiply it.

BTW, why don't you just move out of your IL's place? That's what this is all about, isn't it?

 

[cardaway]

Like the cost of rent.

30 years ago, my dad bought his first brand new car for $1,995. The average price of a midsize car same style today is $18,000. My dad made $10,400 when he bought that car.

Rest assured, I don't make $93,000 a year.

Have you seen the posts that explained the inflation factor? Look at the one about gas prices for example. Pretty much the same for other things as well.

 

[Miss Jasmine]

Inflation isn't a linear formula -- you don't just take the cost of something and multiply it.

BTW, why don't you just move out of your IL's place? That's what this is all about, isn't it?

Nothing like getting right down to the root of the matter, huh? That's why I explained how I saved up for my downpayment.

 

[boomhauer]

Inflation isn't a linear formula -- you don't just take the cost of something and multiply it.

BTW, why don't you just move out of your IL's place? That's what this is all about, isn't it?

I saw that chart, but since it works both ways, I figure the numbers can't be too far off.

This has nothing to do with my inlaws. Well, I guess it does since eventually we'd like to buy our own home.

I'm simply trying to figure out why it is, that it is so much harder to own a home today, than when my parents were my age.

 

[cardaway]

I'll bet very few of us in the middle class would be at all satisfied with a 1970's life today.

Only because we've seen the future (technology).

 

[Galahad]

By better position, I don't mean "things". I mean looking at my net worth and my future possibilities, I think I am in a better position.

I agree. I just think it's hard to make the case that we're not better off all the way 'round.

 

[cardaway]

I'm simply trying to figure out why it is, that it is so much harder to own a home today, than when my parents were my age.

I know many people who had homes much sooner than their parents. In fact I thought Baby Boomers loved to brag about that. That they raised their kids such that they did much better at a younger age.

 

[Miss Jasmine]

I agree. I just think it's hard to make the case that we're not better off all the way 'round.

And I agree with this.

I know many people who had homes much sooner than their parents. In fact I thought Baby Boomers loved to brag about that. That they raised their kids such that they did much better at a younger age.

And I was 26 when I bought my first home (and only home so far at this point). DH was in his very early 20s when he bought his first one.

 

[barkley]

My father retired with a very nice pension plan with his company. This was given to all employees as a benefit. Now, most of us must contribute a portion of our own salaries to a 401k (or similar)...and the company (usually) matches a small percentage of that. I wonder if I will ever be able to retire at all based on this. ???

my dad worked for government but started that job at an age where he knew he could only put in a max of 10 years (back when some classifications had mandatory retirement ages). he managed to swing a deal with personnel to do a double retirement contribution each month so he could retire with what was comparabe to a 20 year career-i don't know many people now (whose jobs have a required employee retirement contribution) who would be willing to go without their luxuries for this type of advance planning.

as far as retirement planning goes-it's such a different mind set today. i mean-people are much more financialy aware of what their needs will be and how they can invest it (if they can afford to) but-what is the percentage that actualy do?

i worked for a government agency that (before my time) had an AWSOME retirement plan. the pay out formula was number of years of service x 3%-so after 30 years you could retire at 90% of your final salary. but it took an employee contribution of about 2x what anyother area employers were doing. well, the employees rebelled and said it was inequitable to require them to pay such outrageous retirement contributions, so the agency developed a second tier retirement system and employees could opt into that (it resulted in their paying about half as much in each month)...fast forward 15 years and the "opt-outs" are starting to look at retirement, they are appaled that after 30 years of employment they can't afford to retire cuz the second tier only pays 2% (60% of their final salary) they rebel AGAIN-and the agency developes a 3rd tier-which results in the employee paying twice as much as their original retirement contribution but adjusts the benefit up to 2 1/2% (75% of final pay).

the result-"oh it's too much-i don't want to have to pay that", maybe 30% of the workforce opts into it

my kids don't do without by any means, but i constantly hear "but why can't we go to the video store and rent some games, why can't we go to the carnival..." and i am constantly responding "it's a choice-do you want to do that or be able to go on a nice vacation this summer because there is only so much money for fun things". this has'nt made much sense to them until recently when my daughter started thinking outloud about some school friends who had said to her "you must be rich, we could never go to disneyworld", she said "you know mom, such and such get to rent videos every week and they go to fast food 2 nites a week, and they always go to the movies...maybe if their mom and dad stopped letting them do that they could save for a disneyworld trip" : i'm think i'm doing my part to change the financial mind set of at least a few members of the next working generation

 

[cardaway]

And I was 26 when I bought my first home (and only home so far at this point). DH was in his very early 20s when he bought his first one.

We (first wife and I) were 21. It was a condo in the city. Made the choice to live in the city and not be tied down with yardwork and other things house related. Big mistake. That house would be worth lots more, the same condo isn't much more at all now.

 

[boomhauer]

And I agree with this.


And I was 26 when I bought my first home (and only home so far at this point). DH was in his very early 20s when he bought his first one.

We must be from very different locations. I live in Massachusetts, and not one of my friends, who are all over 25, own their own home. I can only think of about 10 friends offhand, but nope - Not a 1 owns a home yet.

 

[mickeyfan2]

I'm simply trying to figure out why it is, that it is so much harder to own a home today, than when my parents were my age.

What age did you parents by their first home?

BTW the other day on TV they said homeownership in the US is at an all time high and the sq footage is too. Maybe in your case your Dad had it better. But maybe he also had it better than most of his time did. My parents bought their first home at 27 with my grandparents putting the downpayment on it. It was about 1500 sq ft. When they were 32 they bought a 2400 sq ft. home. Myself, I built a 4000 sq ft home at 30 and moved in when I was 31. So yes I think I was better off. But that is just my case.

 

[boomhauer]

What age did you parents by their first home?

BTW the other day on TV they said homeownership in the US is at an all time high.

25 and 26.

And savings is at an all time low. Think there's a connection?

 

[Crankyshank]

I know many people who had homes much sooner than their parents. In fact I thought Baby Boomers loved to brag about that. That they raised their kids such that they did much better at a younger age.

My parents are baby boomers and their house is slightly larger than my Mother's parents. Probably because it's about 20yrs newer. My Father's mother never owned a house.
My parents bought their first house when they were 22 and 26. They've lived in their current very nice house (much nicer than mine) since they were 30 and 34. I didn't buy my first house until I was 28 and there's no way I could afford a house similar to my parents (about 3x's more expensive than my own house) for a very long time.