Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 10-23-2014, 05:33 PM   #21
Moderator
Walt34's Avatar
 
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 16,544
Quote:
Originally Posted by ziggy29 View Post
Yes, I think the middle class is getting squeezed and real wages are not keeping up with the cost of living, but I also think there's a lot of "leakage" in a typical middle class budget. Twenty here, fifty there, and the end of the month your "how did my money go here" budget is larger than most of the others.
That and there are so many things considered "necessities" now that didn't even exist when I was growing up. Cell phones, home computers, laptops, tablets, Internet access, cable TV, software (well, it existed, but none was for home use) and other stuff that causes recurring expenses that I haven't thought of.
__________________

__________________
I heard the call to do nothing. So I answered it.
Walt34 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 10-23-2014, 09:06 PM   #22
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2013
Posts: 5,327
While I do think the middle class is getting squeezed and expenses like healthcare are way too high, I just marvel at many of the stats I read about. The average person throws away 65 pounds of clothes a year:

Yearly Textile Waste in the USA

Used clothes are our now our 8th largest export? When saving rates are so low? I don't get that. Hundreds of millions spent on pet costumes? There do seem to be a lot of areas the middle class could cut back on.

Ezra Klein has a good blog post on the subject -

"The question Keynes set out to solve was how humanity would adapt to a world of abundance. “He saw two options,” explains Nobel Prize-winning economist Joseph Stiglitz. “One was that we could consume ever more goods. Or we could enjoy more leisure. What worried Keynes was that when you looked at how people in the British upper classes spent their leisure, he was not overly enthralled with what he saw.” By and large, we have chosen door number one."
__________________

__________________
daylatedollarshort is offline   Reply With Quote
Old 10-23-2014, 09:36 PM   #23
Thinks s/he gets paid by the post
imoldernu's Avatar
 
Join Date: Jul 2012
Location: Peru
Posts: 4,616
Middle class can't afford, but the advertisers direct to youth. Kind of strange, when the folks with money are seniors, and most businesses don't direct their advertising to them according to this AARP article.
Why Advertisers Ignore Baby Boomers and Their Money - AARP

Selling Older Consumers Short
Boomers have the bucks, but advertisers don't seem to care
by David Wallis, AARP Bulletin, October 2014
__________________
Today is the oldest you've ever been, and the youngest you'll ever be again. - Eleanor Roosevelt
imoldernu is offline   Reply With Quote
Old 10-24-2014, 04:54 AM   #24
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
I truly detest articles like this that ignore obvious economic data that doesn't fit into their bias. The basic premise of these article was their was some glorious bygone eras that existed outside of 1950s TV when the middle class could afford all this stuff.
Affordability is pretty subjective test what interests me is how much American's buy this stuff now vs the past.

Auto
Vehicles Per Thousands
1980 710
1990 773
2000 800
2007 843
2009 829

Now vehicle ownership did slip during the great recession. But 2014 is shaping up to be one of the best year for new car yeas in 20 years, so I would bet that 2014 vehicle ownership would be back near the 2009 and healthy 9% increase in a generation. Cars are kept longer, but that is in large part cause they are lot more reliable, safer, cheaper to operate, and simply last longer than 1990 era cars.

Vacations
The DOT data only goes back to 1996..
In the summer months (June, July, Aug) of 1996 and average of 52.8 million people took airline flight each month.
In the same time period in 2013/2014 69.3 million flew each month. An increase of 30% in less than 18 years.
The Average Airline fare in back in 1995 (in 2014 $) was $451 it has fallen to $381 through Q1 of 2014. So more people fire at lower price airfare, how are vacations less affordable now than in the past?
Now hotel information is harder to obtain, but the significant increase in AirBnB and VBRO seems to point to vacations being more not less affordable.

I'll leave it the medical folks on the board to gather statistic if any care to but I'd be willing to bet that there were more Doctor and dentist visits, more procedures, tests, and drugs prescribed now than there were a 20-25 years ago on a per capita basis.
__________________
clifp is offline   Reply With Quote
Old 10-24-2014, 06:18 AM   #25
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Amethyst's Avatar
 
Join Date: Dec 2008
Posts: 5,891
Oh, all sorts of vendors claim to be interested in my money! Just a sampling of the delectable wares that are on offer:
  • Walk-In Bathtubs
  • Gigantic Underwear
  • Elastic Waist Slacks/Sweater Combos
  • Expensive River Cruises, with Brochures Featuring Only Gray-haired People
  • Stairway Elevator Chairs
  • Assisted Living - Live in a tiny cottage or condo for only $4,000 a month!
  • People offering to Teach Me to Use a Computer!
So maybe it is not that advertisers aren't trying to target older people. It's that they're so darn clumsy and bigoted about it. Why wouldn't they offer me beautiful clothing, gorgeous houses with all the mod-cons, and cruise ship brochures showing vital, attractive people cavorting about?

Amethyst

Quote:
Originally Posted by imoldernu View Post
Middle class can't afford, but the advertisers direct to youth. Kind of strange, when the folks with money are seniors, and most businesses don't direct their advertising to them
__________________
If you understood everything I say, you'd be me ~ Miles Davis
'There is only one success – to be able to spend your life in your own way.’ Christopher Morley.
Amethyst is offline   Reply With Quote
Old 10-24-2014, 08:34 AM   #26
Thinks s/he gets paid by the post
 
Join Date: Oct 2006
Posts: 3,820
This complaint is seriously innumerate:

Quote:
“Median-income families in only one major city [Washington DC] can afford the average price Americans are paying for new cars and trucks nowadays.”
It's always been true that the median family doesn't buy the average priced new car. Lower income families have always bought used cars or no cars. So, of course, average new cars prices are driven by the budgets of upper income families. If they want air conditioning, keyless entry, and 200 hp engines, that will determine the average cost. And, surprise, average new cars will cost more than the median family can "afford".
__________________
Independent is offline   Reply With Quote
Old 10-24-2014, 08:42 AM   #27
Moderator Emeritus
Bestwifeever's Avatar
 
Join Date: Sep 2007
Posts: 16,375
Quote:
Originally Posted by Amethyst View Post
?... maybe it is not that advertisers aren't trying to target older people. It's that they're so darn clumsy and bigoted about it. Why wouldn't they offer me beautiful clothing, gorgeous houses with all the mod-cons, and cruise ship brochures showing vital, attractive people cavorting about?

Amethyst
Amazing that advertisers think commercials with incontinent dancing funny-looking women will sell more bladder protection products.
__________________
“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
Bestwifeever is offline   Reply With Quote
Old 10-24-2014, 09:02 AM   #28
Recycles dryer sheets
 
Join Date: Sep 2014
Posts: 461
Did everyone read the same article.

The article states that many middle income earners can no longer REALLY afford these items. Yes the middle class can spend the money but the article explains the consequences very well.

They said a vacation would require a sacrifice of not buying another big ticket item.

The article is saying middle income people shouldn't buy a new 32k car .

Medical ,credit card debt and student loan debt also is putting a huge strain on spending for the middle class.

So people don't have emergency funds. True

Retirement savings is low. Also true
At 50k a year with 2 kids retirement savings is going to suffer.

Not to mention paying for kids college and broke aging parents or in laws who need help
__________________
purplesky is offline   Reply With Quote
Old 10-24-2014, 10:00 AM   #29
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,381
Quote:
Originally Posted by Amethyst View Post
Oh, all sorts of vendors claim to be interested in my money! Just a sampling of the delectable wares that are on offer:
  • Walk-In Bathtubs
  • Gigantic Underwear
  • Elastic Waist Slacks/Sweater Combos
  • Expensive River Cruises, with Brochures Featuring Only Gray-haired People
  • Stairway Elevator Chairs
  • Assisted Living - Live in a tiny cottage or condo for only $4,000 a month!
  • People offering to Teach Me to Use a Computer!
So maybe it is not that advertisers aren't trying to target older people. It's that they're so darn clumsy and bigoted about it. Why wouldn't they offer me beautiful clothing, gorgeous houses with all the mod-cons, and cruise ship brochures showing vital, attractive people cavorting about?

Amethyst

Fox News commercials are all about catering to the elders. I watch a few of the evening shows occasionally and their commercials are targeted at an age that makes me feel like a teenager. Of course their viewing age is around 65 if memory serves me.


Sent from my iPad using Tapatalk
__________________
Mulligan is offline   Reply With Quote
Old 10-24-2014, 10:31 AM   #30
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Quote:
Originally Posted by Mulligan View Post
Fox News commercials are all about catering to the elders. I watch a few of the evening shows occasionally and their commercials are targeted at an age that makes me feel like a teenager. Of course their viewing age is around 65 if memory serves me.


Sent from my iPad using Tapatalk
Sounds like they are catering to the "get off my lawn" demographic.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 10-24-2014, 10:41 AM   #31
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,381
Quote:
Originally Posted by brewer12345 View Post
Sounds like they are catering to the "get off my lawn" demographic.

It is definitely a narrow but significant demographic, and it is plan to see I will be among them in a few years!


Sent from my iPad using Tapatalk
__________________
Mulligan is offline   Reply With Quote
Old 10-24-2014, 10:51 AM   #32
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Amethyst's Avatar
 
Join Date: Dec 2008
Posts: 5,891
I know, right? What I am trying to say is that not everybody over 50 needs diapers, at least not yet. Advertisements, however, give the impression that everyone is singing, dancing, wearing thigh-high boots, drinking Gator Spit and buying everything in sight, right up till their 50th birthday. Then they suddenly fall off a high cliff and become demented, incontinent, and unable to take a bath by themselves.

Gee, I hope the "millennials" are listening. You only have a few years left! Better buy stuff now!

Amethyst

Quote:
Originally Posted by Bestwifeever View Post
Amazing that advertisers think commercials with incontinent dancing funny-looking women will sell more bladder protection products.
__________________
If you understood everything I say, you'd be me ~ Miles Davis
'There is only one success – to be able to spend your life in your own way.’ Christopher Morley.
Amethyst is offline   Reply With Quote
Old 10-24-2014, 11:01 AM   #33
Thinks s/he gets paid by the post
 
Join Date: Aug 2005
Posts: 2,056
On the subject of new cars, my grandparents on my Dad's side of the family tended to buy fairly often. But, they were always a one-car family, so they never had the expense of a second car. The cars they bought were...
1949 Ford (bought used, everything else was brand-new)
1957 Ford Fairlane 500 4-door hardtop ($3500 as equipped, and, adjusted for inflation, probably the most expensive car they ever owned)
1961 Ford Galaxie 500 4-door hardtop
1963 Mercury Monterrey 4-door hardtop (Granddad liked the "Breezeway" roll-down rear window, which made it handy for hauling lumber, ladders, etc...)
1967 Pontiac Tempest hardtop coupe (kids were all grown by this time, no need for a large-ish 4-door)
1971 Pontiac Tempest hardtop coupe
1975 Dodge Dart Swinger
1977 Ford Granada coupe
1981 Ford Granada coupe
1985 Ford LTD
1989 Ford Taurus LX
1994 Ford Taurus GL.

Most of these cars were still in good shape when they traded, it's just that Granddad liked to dump them before anything major cropped up. He really liked the '61 Galaxie, but traded it prematurely because he wanted that roll-down rear window that the Mercury offered. The '75 Dart was troublesome, constantly stalling out, and the dealer never could fix it, so it was traded prematurely on the Granada, which ate a transmission almost immediately...but at least was under warranty. And relatively trouble-free the rest of its time with them.

I think the '89 Taurus only had about 30,000 miles on it when they traded, but by that time, Grandmom was getting sick, and Granddad wanted a brand-new, reliable car, just in case. I think she died about 7-8 months after he bought the '94. I remember Granddad wanting me to take him car shopping in 2000. He was so used to trading every 3-4 years, and at this point he'd had the Taurus almost seven years, so in his mind he was way overdue. But, he didn't like the new cars that were out by then, and he was only up to around 30,000 miles on this car, so I talked him into keeping it.

Grandmom and Granddad were pretty much middle class, IMO. Granddad retired from the railroad in 1974, making $6.00 per hour, at the age of 60. Grandmom had always worked as well, but more sporadically, as she had taken time off when the kids were little. She retired around the same time. Even though they traded cars fairly often, by and large the cars were fairly modest. It's not like they were buying a brand-new Lincoln or Cadillac every few years.
__________________
Andre1969 is offline   Reply With Quote
Old 10-24-2014, 11:02 AM   #34
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
HFWR's Avatar
 
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 12,964
Quote:
Originally Posted by Amethyst View Post
I know, right? What I am trying to say is that not everybody over 50 needs diapers, at least not yet. Advertisements, however, give the impression that everyone is singing, dancing, wearing thigh-high boots, drinking Gator Spit and buying everything in sight, right up till their 50th birthday. Then they suddenly fall off a high cliff and become demented, incontinent, and unable to take a bath by themselves.

Gee, I hope the "millennials" are listening. You only have a few years left! Better buy stuff now!

Amethyst
__________________
Have Funds, Will Retire

...not doing anything of true substance...
HFWR is offline   Reply With Quote
Old 10-24-2014, 04:22 PM   #35
Full time employment: Posting here.
 
Join Date: Feb 2008
Posts: 920
Quote:
Originally Posted by Andre1969 View Post
One thing that bugs me is how that article mentioned that the average price of a new car these days is around $32,000.
I suspect this is one of those things where median would be a lot more useful measure than average.
__________________
tuixiu is offline   Reply With Quote
Old 10-24-2014, 04:36 PM   #36
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,381
Quote:
Originally Posted by tuixiu View Post
I suspect this is one of those things where median would be a lot more useful measure than average.

My GF bought a brand new Civic with what she wanted for $17k and is very pleased. Unfortunately anything I want is 35k and up. So I went the cheap way a couple months ago and bought a $38k when brand new SUV for $12k. It looks brand new because I bought it from a one owner old man who paid cash for it. I don't begrudge anyone who buys brand new, I just cannot peal off the bills that are stuck clinging to the inside walls of my piggybank.


Sent from my iPad using Tapatalk
__________________
Mulligan is offline   Reply With Quote
Old 10-24-2014, 07:19 PM   #37
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,450
Quote:
Originally Posted by purplesky View Post
Did everyone read the same article.

The article states that many middle income earners can no longer REALLY afford these items. Yes the middle class can spend the money but the article explains the consequences very well.

They said a vacation would require a sacrifice of not buying another big ticket item.

The article is saying middle income people shouldn't buy a new 32k car .

Medical ,credit card debt and student loan debt also is putting a huge strain on spending for the middle class.

So people don't have emergency funds. True

Retirement savings is low. Also true
At 50k a year with 2 kids retirement savings is going to suffer.

Not to mention paying for kids college and broke aging parents or in laws who need help

Yes I did . The author states her belief I just don't think she proved her case very well.

Affordable is highly subjective term some couples with a $60K income may consider a $30K car or $300K house affordable another may not consider them affordable and both couples could be right.

By the LYBM standards of many folks on this forum, new cars and vacations were never affordable to the average American family EVER. If you don't have cash to pay for these things you don't buy them. Fortunately for the American economy hundreds of millions did buy these things on credit.

If the author showed that American were getting less of these things, than in the past, that would bolster her argument. But as I showed American have more cars, and fly more during the summer months (my proxy for vacations) than we have in the past.

So if these things were truly less affordable and yet we were consuming more of them, then only way we could be doing so is going deeper into debt. If you have an alternate explanation I'd be happy to to hear it.

But that doesn't seem to be the case.
Quote:
he percentage of U.S. households in debt shrank over a decade, even while the median amount owed shot to $70,000, the Census Bureau reported today. Almost three-quarters of American households reported holding some form of debt in 2000. Eleven years later, the share had fallen to 69 percent in the wake of the worst economic downturn since the Great Depression, the first drop in median household debt in more than a decade.

...
The percentage of American households holding any type of debt peaked in 2002 at 75 percent and has been declining steadily. The total median household debt hit its high of $74,619 in 2010, the Census Bureau said...


Unsecured debt, which includes credit cards and student loans, rose for all U.S. households to $7,000, a 30.5 percent increase from the $5,365 median tab registered in 2000.
So really the only thing that points to American putting the vacations etc on their credit card is fairly modest increase of unsecured debt, and I suspect that much of that increase is due to student loan debt.

Forget to add, we have a word to describe Americans who can afford to buy a big ticket item without sacrificing something else. That word is called rich
__________________
clifp is offline   Reply With Quote
Old 10-24-2014, 10:01 PM   #38
Recycles dryer sheets
 
Join Date: Sep 2014
Posts: 461
Quote:
Originally Posted by clifp View Post
Yes I did . The author states her belief I just don't think she proved her case very well.

Affordable is highly subjective term some couples with a $60K income may consider a $30K car or $300K house affordable another may not consider them affordable and both couples could be right.

By the LYBM standards of many folks on this forum, new cars and vacations were never affordable to the average American family EVER. If you don't have cash to pay for these things you don't buy them. Fortunately for the American economy hundreds of millions did buy these things on credit.

If the author showed that American were getting less of these things, than in the past, that would bolster her argument. But as I showed American have more cars, and fly more during the summer months (my proxy for vacations) than we have in the past.

So if these things were truly less affordable and yet we were consuming more of them, then only way we could be doing so is going deeper into debt. If you have an alternate explanation I'd be happy to to hear it.

But that doesn't seem to be the case.
So really the only thing that points to American putting the vacations etc on their credit card is fairly modest increase of unsecured debt, and I suspect that much of that increase is due to student loan debt.

Forget to add, we have a word to describe Americans who can afford to buy a big ticket item without sacrificing something else. That word is called rich
My takeaway from the article is that she is telling the reader that a middle class person making 56k cannot REALLY afford the avg. price of 32k for a new car that people are currently paying. And she added a helpful quote "
just because you can manage the monthly payment doesn’t mean you should let a $30,000 or $40,000 ride gobble up all such a huge share of your paycheck.” That is too much car for 56k in income..If you are making 56k. A 300k house and a 30k car and vacations and a 6 month emergency fund and a reasonably funded 401k and a college fund for little billy is not happening. But wait. Health insurance,car insurance,cell phone,utilities,neighborhood association fee,clothing,etc,

I really don't think the average middle class American is going on a real vacation much.

What I learned from her article was helpful.

6 month emergency fund. Don't buy too much car. Stay away from credit card debt. Save for retirement. If you go on vacation don't over spend on other big ticket items at same time.

I read the thread before I read her article and I expected something different.

The spending power of the middle class is not what it used to be.

I am not trying to argue. I just got a different message or angle from the article.

__________________
purplesky is offline   Reply With Quote
Old 10-24-2014, 10:10 PM   #39
Full time employment: Posting here.
Calico's Avatar
 
Join Date: Apr 2012
Posts: 924
Quote:
Originally Posted by Amethyst View Post
I know, right? What I am trying to say is that not everybody over 50 needs diapers, at least not yet. Advertisements, however, give the impression that everyone is singing, dancing, wearing thigh-high boots, drinking Gator Spit and buying everything in sight, right up till their 50th birthday. Then they suddenly fall off a high cliff and become demented, incontinent, and unable to take a bath by themselves.

Gee, I hope the "millennials" are listening. You only have a few years left! Better buy stuff now!

Amethyst


On a related note, I received yet another brochure in the mail yesterday gently urging me to plan ahead for my "final expenses" in order to spare my family members the trauma of having to do so. I won't be 59 for a couple more months. I guess the end is nigh.
__________________
Calico is offline   Reply With Quote
Old 10-25-2014, 01:23 PM   #40
Thinks s/he gets paid by the post
 
Join Date: Aug 2006
Posts: 1,361
This old youtube lecture by Elizabeth Warren before she entered politics does a much better job of presenting this case, IMO. She does a pretty thorough job of presenting actual data--




Quote:
Originally Posted by clifp View Post
I truly detest articles like this that ignore obvious economic data that doesn't fit into their bias. The basic premise of these article was their was some glorious bygone eras that existed outside of 1950s TV when the middle class could afford all this stuff.
Affordability is pretty subjective test what interests me is how much American's buy this stuff now vs the past.
__________________

__________________
Hamlet is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Rise of the middle-class millionaire omni550 FIRE and Money 17 03-07-2008 05:22 PM
Can I record seven TV channels simultaneously & digitally? Nords Other topics 27 07-08-2007 02:34 PM
Can I retire in 7 seven years Outby7 Hi, I am... 5 11-23-2005 12:34 PM
Any middle class ER wannabe's? laurence Young Dreamers 67 04-14-2005 09:51 AM
Decline of the U.S. Middle Class? Cut-Throat Life after FIRE 83 09-10-2004 08:32 AM

 

 
All times are GMT -6. The time now is 06:49 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.