Wednesday, July 30, 2014

The Economy - Inflation

I was just wondering why it seemed that my parents were better off financially in the 1980’s with only my dad working then we are with two good incomes today. My dad made $60,000 a year in the 80’s. I make over $80,000 today and my wife makes over $60,000, so we should be doing way better than they did, but we are not. My parents had no problem buying four properties (we can only afford one). My parents put two kids through college (California State Universities) at the same time and paid cash without a problem (we can barely afford to put one through, and that includes borrowing to do so, and we have another one getting ready to start in a year).

How come they were so much better off making so much less? Inflation! I just ran my dad’s salary through an inflation calculator (http://www.bls.gov/data/inflation_calculator.htm) and he would be making $15,000 a month today, or $180,000 a year! I also never remember him complaining about taxes or the cost of gas, electricity, water, or food. Inflation has made us all poorer. I wonder if it is also responsible for so many of the problems we face today.

What do you think?