A contributor was exploring the cost of her parents' extravagant wedding in San Francisco in 1974, and researched to offer an actual cost of how much that same caliber of wedding in the same location would cost today. She also then offered the calculations as a side by side comparison for what flowers, church rental, photographer and more would have cost if calculated solely at the cost of inflation...in other words, 1974 actual cost, cost of inflation estimated cost, and 2017 actual cost.
It was mind blowing to see the difference! The estimated costs were, in general FAR FAR below the real 2017 cost, with increases from 84% to a staggering 941% increase between 1974 prices.
Now, we have all heard the percentages as it relates to college costs, with some placing it as high as an 1120% increase over the course of the past 30 years. (See Bloomberg), but are we seeing how costs for just about everything have increased exponentially far beyond income? Do we get how much harder it is for our kids to have the same quality of life we had...not now, but when we were starting out?
I think (since this is an opinion piece, I am allowed to do that!) that one thing that has fooled us is the Walmartization of America, which has allowed us to have certain goods at far less cost than we used to pay for them. Soft goods, household appliances, etc. are far less expensive than they were in 1974, as a percentage of income. But as another article I found explains, the cost of our big ticket items is where we getting kicked in the pants...housing, health insurance, education costs, and other services. So we may have more "stuff" around us and be able to buy even more "stuff" but we are not seeing how a few key expenses have risen so quickly and to such heights that cost of living increases in income could never possibly keep up.
This article at www.mybudget360.com makes a great point, and I will quote a couple of points:
"We continually hear about the middle class shrinking. But where are they shrinking to? Much of the disappearing act has come at the hands of inflation. That is, their income is no longer sufficient to support the items that we once categorized as part of the middle class: a car, a home, college education for the kids, and basic healthcare. For many Americans, these items are all getting out of reach. And for those that purchase them, they are required to go into massive debt with banks."
"What is more affordable relative to inflation? Milk, eggs, and a postage stamp. Unfortunately these are tiny line items on your household budget.
What you need to look at is the median income here. US households overall are simply poorer. They have less to spend relative to the cost of goods and services. Money is only as good as what it can purchase. You can’t eat hundred dollar bills. This is part of the reason why many people feel like they are poorer. "
We, as parents, need to be very realistic about what it is going to take to get our kids started in the world, and how long that may take. It is harder for them than it was for us. Period. Significantly harder. It will require, perhaps, kids remaining in their parental home longer, it may require longer to establish independence financially, and it may require being far more intentional about teaching them sound spending and saving habits.
If we do not do our research and understand what our young adults are facing as they try to find their way in the world, we will have incredibly unrealistic expectations about their ability to make it. We will damage our relationships with them by insisting that "We did it when we were your age, you can too!"...yes, they can...eventually, with strong support, better training, and probably more time. This is not to say all is "doomsday", but awareness of the realities our kids face will help us do a better job as their educators, and will help us be more understanding parents.