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Luxury vs Necessity
Old 04-25-2009, 02:32 PM   #1
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Luxury vs Necessity

Very interesting article on what we Americans say we can do without (cable TV, microwave) and what we can't (cell phone).

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As expected, the survey also finds that people who have taken the biggest economic hits during this recession are the ones most inclined to have tightened their belts. So, for example, if a respondent or someone in that person's household lost a job in the past year, had trouble paying the mortgage or rent, or lost more than 20% in a retirement account or other investments, the respondent is more likely than others surveyed to have economized in a variety of ways.
Pew Research Center: Luxury or Necessity? The Public Makes a U-Turn
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Old 04-25-2009, 03:37 PM   #2
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Interesting.

By that definition, I am not one of those who have taken the biggest economic hits due to the recession. And, I have not tightened my belt in any of the ways listed.

However I have cut back a little on discretionary expenses entirely (not just buying cheaper brands, or eliminating alcohol and tobacco), but that is not on the list.

Interesting the percentage of people who claim each of these items is a necessity (from the article):
car88%
landline phone68%
clothes dryer66%
A/C54%
TV52%
computer50%
cell phone49%
microwave47%
high speed internet31%
cable/satellite TV23%
dishwasher21%
flatscreen TV8%
iPod4%
I don't think a car, dishwasher, iPod, flatscreen TV, cell phone or home A/C qualify as necessities but a computer, high speed internet, TV, clothes dryer, and microwave are sure nice to have. (I suppose really none of these are strictly necessary.) What I consider to be necessities for me weren't listed and include sewer with flush toilets, trash collection, potable water, and electricity, in that order.
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Old 04-25-2009, 03:52 PM   #3
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Quote:
Originally Posted by Want2retire View Post
Interesting.

By that definition, I am not one of those who have taken the biggest economic hits due to the recession. And, I have not tightened my belt in any of the ways listed.

However I have cut back a little on discretionary expenses entirely (not just buying cheaper brands, or eliminating alcohol and tobacco), but that is not on the list.

Interesting the percentage of people who claim each of these items is a necessity (from the article):
car88%
landline phone68%
clothes dryer66%
A/C54%
TV52%
computer50%
cell phone49%
microwave47%
high speed internet31%
cable/satellite TV23%
dishwasher21%
flatscreen TV8%
iPod4%
I don't think a car, dishwasher, iPod, flatscreen TV, cell phone or home A/C qualify as necessities but a computer, high speed internet, TV, clothes dryer, and microwave are sure nice to have. (I suppose really none of these are strictly necessary.) What I consider to be necessities for me weren't listed and include sewer with flush toilets, trash collection, potable water, and electricity, in that order.
Need a car, unless I move
Need landline for DSL
Never had clothes dryer
Use A/C now and again
TV is approaching non-necessity status
Computer - will not live without
Cell phone- could give up, costs about $100/yr
Microwave - necessary
High speed internet - necessary
Cable/satellite - see TV
Dishwasher - necessary
Flatscreen TV - see TV
IPod - don't have or want

Especially those
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Old 04-25-2009, 04:37 PM   #4
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Quote:
Originally Posted by Want2retire View Post
Interesting.

By that definition, I am not one of those who have taken the biggest economic hits due to the recession. And, I have not tightened my belt in any of the ways listed.

However I have cut back a little on discretionary expenses entirely (not just buying cheaper brands, or eliminating alcohol and tobacco), but that is not on the list.

Interesting the percentage of people who claim each of these items is a necessity (from the article):
car88%
landline phone68%
clothes dryer66%
A/C54%
TV52%
computer50%
cell phone49%
microwave47%
high speed internet31%
cable/satellite TV23%
dishwasher21%
flatscreen TV8%
iPod4%
I don't think a car, dishwasher, iPod, flatscreen TV, cell phone or home A/C qualify as necessities but a computer, high speed internet, TV, clothes dryer, and microwave are sure nice to have. (I suppose really none of these are strictly necessary.) What I consider to be necessities for me weren't listed and include sewer with flush toilets, trash collection, potable water, and electricity, in that order.
I think that, for a situation requiring some temporary belt tightening such as a job loss, I could do without a lot of things on that list. But, for the longer term, I don't see myself giving up my cell phone, computer and high speed internet. I could do without flat screen TV (and even TV altogether), cable, ipod, microwave, land line, dryer and dishwasher. I wouldn't mind giving up the A/C and the car, but I would have to move...
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Old 04-25-2009, 04:57 PM   #5
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I've done 5 of the top 7, so I guess I've been belt tightening, and happy to do so. We shop less and watch for sales even more, cancelled our landline (still have cell phones), reduced our satellite TV package, cut back on alcohol (and restaurants), and sold a ton of stuff on eBay for the first time ever. Thinking about getting more serious about growing veggies this year too. We've done it in the past, but the wildlife eats everything we grow before we can harvest, so not very fruitful (pun intended).
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Old 04-25-2009, 07:48 PM   #6
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So if you're already routinely doing most of the things on that list as a lifestyle, and a recession hits, then are you screwed or are you blissfully ignorant?

Reminds me of California's water-conservation measures during the 1980s drought. At one point they planned to impose 20% cuts on everyone's average water use, with financial penalties for exceeding that amount. Of course our 20% cut would have been a lot more painful than our neighbor's cut, who lived alone yet managed to use four times the volume. She was absolutely revolted to discover that most people don't take a bath every morning and night...
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Old 04-25-2009, 07:51 PM   #7
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I haven't done any of those things. I was going to say I bought less expensive brands, but that's something I do anyhow. What I have done is delay major purchases and expenses such as home renovation and a new car, and reduce my monthly DCA into equities in order to build up a bigger emergency fund.

But it's spring, and I feel the urge to spend.....
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Old 04-25-2009, 08:13 PM   #8
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As frugal as we have been, there is little to cut, except for foreign travel.

But, but, but I have had some w*rk income again, and the year is still young, and the various travel Web sites beckon....

Heh, heh, heh... If the stock market keeps up its recovering, I don't see why we can't spend a couple of weeks in Provence in September (been to Avignon, but still want to see Isle-sur-la-Sorgue and other places). Maybe extend to 3 weeks and cram some Italian Tuscan towns in there.

Heh, heh, heh... You can't take it with you...

Just came back from a nursing home/rehab center to visit my 91-yr old FIL who is recovering from a hip-breaking fall. Who is to say my lifespan will be longer than my own father's, who died at 74? A guy I know who is only in his late 40s says he needs to see a nephrologist, as his blood test was not that good. He looks really fit and has a health-conscious lifestyle, but you never know!
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Old 04-25-2009, 08:19 PM   #9
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I have three types of expenses in my budget....

Necessary....
Luxury.....
Sin....

So far I haven't had to make any cutbacks...
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Old 04-25-2009, 08:22 PM   #10
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I'd rather just cut out the Luxury part, and indulge in the Sin part occasionally.
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Old 04-25-2009, 08:23 PM   #11
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Quote:
Originally Posted by Nords View Post
So if you're already routinely doing most of the things on that list as a lifestyle, and a recession hits, then are you screwed or are you blissfully ignorant?

Reminds me of California's water-conservation measures during the 1980s drought. At one point they planned to impose 20% cuts on everyone's average water use, with financial penalties for exceeding that amount. Of course our 20% cut would have been a lot more painful than our neighbor's cut, who lived alone yet managed to use four times the volume. She was absolutely revolted to discover that most people don't take a bath every morning and night...
Sounds about right. When we've had droughts in Ohio, they published all sorts of ways to cut back on water use. I was already doing such and more that had never occurred to them.
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Old 04-25-2009, 08:35 PM   #12
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I'd rather just cut out the Luxury part, and indulge in the Sin part occasionally.
Just occasionally...ahhhh, that's a shame.....
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Old 04-25-2009, 08:44 PM   #13
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Just occasionally...ahhhh, that's a shame.....
Heh! Have you not noticed my signature line (never had one before).

You want my life cut even shorter?
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Old 04-25-2009, 08:48 PM   #14
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I consider the microwave a money saving tool. It costs next to nothing, and consumes negligible power.

The diswasher should be in that category too, but I'm not 100% positive. I think (?) the diswasher uses less water than handwashing.

Sam
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Old 04-25-2009, 08:51 PM   #15
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Heh! Have you not noticed my signature line (never had one before).

You want my life cut even shorter?
My goal is life is to go out with a smile on my face...that usually involves sin....

....I'll leave you alone now.....
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Old 04-25-2009, 08:55 PM   #16
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One can never predict how he/she will exit. It may be tough to keep a smile on your face when you are in pain, sin or saint.
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Old 04-25-2009, 08:59 PM   #17
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Originally Posted by bbbamI View Post
I have three types of expenses in my budget....

Necessary....
Luxury.....
Sin....

So far I haven't had to make any cutbacks...
I think I would order things differently:

1. Sin
2. Necessity
3. Luxury (and even then of limited importance)

And somewhere in there there must be a place for the Neptune Memorial Reef, no?
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Old 04-25-2009, 09:01 PM   #18
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You want my life cut even shorter?
Its like the old joke about the response of the man whose doctor told him to give up cigars or they would take years off his life:

"Which years? 85 through 88? Give me the cigars..."
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Old 04-25-2009, 09:15 PM   #19
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I had a renter before the recession, but when my old roommate moved out, finding a renter took on much higher urgency. It also took 3 months rather than 3 weeks.
I stop using my cleaning Lady the iRobot is almost as good. Got more serious about the garden and I've been using the library more than Amazon.com

I've definitely cutting back on eating out, and trips. My upcoming Vegas trip is costing me $95 including, airfare (frequent flyer) and 3 nights at the Rio.
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Old 04-25-2009, 09:19 PM   #20
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I didn't see my "Necessity for me, luxury for most people" on the list: High end spices and food flavorings. We spend about $200 every 2 years on those - part of the grocery budget.
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