How is the economy effecting you, personally?

[Swammerdami]

There's a poster I've seen several times: "Earn 10,000 Spend 9000 -- Happiness. Earn 10,000 Spend 11,000 -- Torment."

Frankly I've never understood how highish-income Americans manage to spend as much money as they do. Cocaine?

I can't say it really has. Every once in a while I look at a receipt and wince, but I live well below my means, so it's more of a curiosity than a burden.

This fits me. My wife and I have always been quite frugal so my savings -- though rather meager by the standard of retired American professionals -- are enough. The lower cost of living here helps.

In fact my worry is the opposite! My children's inheritance may dull their career ambitions. I'm trying to address that problem by indulging in frivolous but expensive entertainments!

 

[RVonse]

I'm actually hoping for a recession so that prices do have a chance to come down.

Can you explain that more?

Comparing unemployment to inflation and at my age..... unemployment would be a much better prospect than the unrelenting inflation because I'm at retirement age anyway.

But even for the younger people, unemployment is still a much much better prospect than high inflation. Historically consistent high inflation is the sure fire ticket to kill an organized democratic society and start a big war. Hyper inflation was a primary driver for political unrest in Germany and for WW2. When the people work their whole life and suddenly discover they have nothing to show for it they generally start losing it in the streets and in the voting booths.

 

[RVonse]

Are people really looking for tips?

Prior to the pandemic, you could go to Taco Bell, buy a burrito and pay for it (either inside or outside) with your credit card and expect to pay for the food and sales tax. Now the new credit cards machines will not go forward unless a tip is processed. You can still select 0 for the amount but you can not skip the step. And if you do select 0, you are left to wonder what is going to happen to the food you just ordered? If I am going to a sit down restaurant and the service is even remotely satisfactory, I generally leave a 20% tip and don't feel bad about it either. Because, IMO the tip shows my appreciation for the service and the fun of our enjoyment eating there. But now at the fast food the tip has to be figured into the bill before the order is even processed. I always thought of fast food as being the place I go when I'm willing to eat junk but at an economical price. And why don't they just be a little more honest and raise their price instead of all the games?

 

[Jimmy Higgins]

Are people really looking for tips?

Prior to the pandemic, you could go to Taco Bell, buy a burrito and pay for it (either inside or outside) with your credit card and expect to pay for the food and sales tax. Now the new credit cards machines will not go forward unless a tip is processed. You can still select 0 for the amount but you can not skip the step.

So the answer is no then.

And if you do select 0, you are left to wonder what is going to happen to the food you just ordered?

If I don't pick no, I have no idea where the tip goes. And that tip stuff has been on some pay pads well before the pandemic.

 

[Swammerdami]

Prior to the pandemic, you could go to Taco Bell, buy a burrito and pay for it (either inside or outside) with your credit card and expect to pay for the food and sales tax. Now the new credit cards machines will not go forward unless a tip is processed. You can still select 0 for the amount but you can not skip the step. And if you do select 0, you are left to wonder what is going to happen to the food you just ordered? If I am going to a sit down restaurant and the service is even remotely satisfactory, I generally leave a 20% tip and don't feel bad about it either. Because, IMO the tip shows my appreciation for the service and the fun of our enjoyment eating there. But now at the fast food the tip has to be figured into the bill before the order is even processed. I always thought of fast food as being the place I go when I'm willing to eat junk but at an economical price. And why don't they just be a little more honest and raise their price instead of all the games?

Wow. In the olden days, a tip was a reward for good service. But this "tip" does sound like extortion to avoid spittle in the food!

An even stupider trend I've read about is "Pay it forward," with Grace being criticized on-line for:

And I was like, 'THIS IS AN EPIC DAY! Today is my best day ever. People are so kind. WOW!' And then he drops this bomb — he says, 'Yeah, so for every five people in front of you, they returned the gesture back.' So you're telling me that these people were shamed and caught into this congo line of morality that they had to give the gesture back? I'm not that girl. I deserve to have a good day. I deserve to have a free sandwich.

Don't forget that with income inequality in the U.S. being what it is, the extra cost was probably immaterial to the person who started the "congo line."

I read about silly trends in post-rational America and find it hard to believe that these are the same people that landed a man on the Moon.

 

[bilby]

There's a poster I've seen several times: "Earn 10,000 Spend 9000 -- Happiness. Earn 10,000 Spend 11,000 -- Torment.

It's a modernised quote from Dickens - in David Copperfield, Mr Micawber advises:

Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness.
Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are forever floored.

 

[Loren Pechtel]

Prices are up but we have always lived below our means, it's not causing any issues.

 

[thebeave]

I go in about once every two weeks for a major load, and the price changes are fairly breathtaking every time. I find myself cutting back on stuff I used to buy pretty regularly. For example, I used to like to pick up a pre-cooked rotisserie chicken on my big shopping trip, and it would be about $5.99 (this was only about two years ago). Last time I was in the store it was $9.99! So, no more of that for now. I don't buy cheese anymore (always a favorite with me), either. For fast food, I'm starting to use the coupons that come in the mail, which I didn't used to do. No coupon, no fast food is my current motto. I'm fairly well off, so I'm not headed for the life on the streets anytime soon, but I am a bit worried about where inflation is headed over the next few years, as retirement is looming.

Anyone know when the recently passed Inflation Reduction Act is expected to start taking effect on food and gas prices? Can't come soon enough for me!

 

[Don2 (Don1 Revised)]

I go in about once every two weeks for a major load, and the price changes are fairly breathtaking every time. I find myself cutting back on stuff I used to buy pretty regularly. For example, I used to like to pick up a pre-cooked rotisserie chicken on my big shopping trip, and it would be about $5.99 (this was only about two years ago). Last time I was in the store it was $9.99! So, no more of that for now. I don't buy cheese anymore (always a favorite with me), either. For fast food, I'm starting to use the coupons that come in the mail, which I didn't used to do. No coupon, no fast food is my current motto. I'm fairly well off, so I'm not headed for the life on the streets anytime soon, but I am a bit worried about where inflation is headed over the next few years, as retirement is looming.

Retirement not quite looming for me yet...but I am definitely considering impact. My investments took a hit, plus this quick rise if it continues, prices will be so insane at retirement. So, I hear you.

 

[Ford]

I also live below my means, but for awhile that changed after being laid off, landing a lower paying job, then the pandemic hit and I had to take an "essential worker" job that simply did not pay the bills. Went through a lot of the money that I had set aside (just in case, but the case was much worse than I imagined), and 3 years later finally got back to what I was making in my previous career. So now it's a matter of paying off debts, getting stuff done around the house that I've been putting off for a long time, and I'm making better progress because while I always lived below my means, those 3 "lean" years forced me to be even more frugal.

I'm back to paying my bills when they arrive as opposed to when they're due, have an "emergency fund" built back up, and I actually have enough to get some of those around the house things done, but I'm holding off for now. It's just nice to see the money in the bank...and I admit to being very wary of spending that money...just in case.

Oh, and I went to Taco Bell a couple weeks ago and was not prompted to add a tip.

 

[T.G.G. Moogly]

Prices are up but we have always lived below our means, it's not causing any issues.

Ditto that. I suppose that if there are major cuts to Social Security and Medicare I could feel pinched. But there is still lots of room to live even more frugally. So in all not very much affected.

 

[lostone]

I have not been affected that much. Like others, however, at my age, cuts in Medicare could hurt me.

I was irritated recently when an appliance repairman came to fix my leaking washer and told me it was a drainage problem with the hose, and I needed a plumber, since there was nothing he could do, then dropped a $129 visit charge on me and asked for a 20% tip, even though he had done nothing to fix my problem.

 

[Rhea]

there was nothing he could do, then dropped a $129 visit charge on me and asked for a 20% tip,

Wow. Chutzpah.

 

[southernhybrid]

We've been retired for well over five years and we are very fortunate to be doing just fine, partly because we live in a fairly low cost area of Georgia, partly because we have always lived a little below our means and partly because we have a lovely home that has been without a mortgage for over 10 years. It also helps that this year, we got the biggest SS raise in decades. That will help and as others have said, if SS and Medicare get hurt by conservatives, we may have some problems. I doubt that is going to happen soon, and hopefully not for future generations either.

I am also waiting for the banks to release the money that my mom left me and my sisters after she died last month. We already had substantial savings, but this will add a lot to our nest egg. It is hard to not react to some of the increased prices in food, especially restaurant food, but we have the most wonderful restaurant in my small city that specializes in delicious Southern food. I can get a wonderful entree with 2 sides for 10 bucks or less, or 4 delicious vegetable sides for 8.95. The owners feed a couple of homeless people too, so we've been eating there more often lately. We don't like to travel and we really don't need a thing, other than when something breaks down, so that helps us feel very financially secure. I really don't understand greed or wanting a lot of needless material things. Sure, it's nice to have a few luxuries, but it's not a big deal not to have them.

The one thing that kills the savings of older adults in long term care, so if either of us ever need, ( dog forbid ) assisted living or nursing home care, we're fucked. Medicare only covers 2 or 3 weeks of rehab. If you're dirt poor, you can get Medicaid, but the rest of us must use our savings or income to pay for long term care.

 

[thebeave]

We've been retired for well over five years and we are very fortunate to be doing just fine, partly because we live in a fairly low cost area of Georgia, partly because we have always lived a little below our means and partly because we have a lovely home that has been without a mortgage for over 10 years. It also helps that this year, we got the biggest SS raise in decades. That will help and as others have said, if SS and Medicare get hurt by conservatives, we may have some problems. I doubt that is going to happen soon, and hopefully not for future generations either.

I am also waiting for the banks to release the money that my mom left me and my sisters after she died last month. We already had substantial savings, but this will add a lot to our nest egg. It is hard to not react to some of the increased prices in food, especially restaurant food, but we have the most wonderful restaurant in my small city that specializes in delicious Southern food. I can get a wonderful entree with 2 sides for 10 bucks or less, or 4 delicious vegetable sides for 8.95. The owners feed a couple of homeless people too, so we've been eating there more often lately. We don't like to travel and we really don't need a thing, other than when something breaks down, so that helps us feel very financially secure. I really don't understand greed or wanting a lot of needless material things. Sure, it's nice to have a few luxuries, but it's not a big deal not to have them.

The one thing that kills the savings of older adults in long term care, so if either of us ever need, ( dog forbid ) assisted living or nursing home care, we're fucked. Medicare only covers 2 or 3 weeks of rehab. If you're dirt poor, you can get Medicaid, but the rest of us must use our savings or income to pay for long term care.

Its pretty much accepted by all parties that both SS and Medicare will dry up in the not too distant future, unless changes are made. There is a lot of "ostrich with his head in the sand" going on right now in politics with regard to SS and Medicare sustainablity. With people not having kids like they use to to fund the needs of the elderly the situation is pretty grim for future generations. /derail.

 

[Rhea]

The one thing that kills the savings of older adults in long term care, so if either of us ever need, ( dog forbid ) assisted living or nursing home care, we're fucked. Medicare only covers 2 or 3 weeks of rehab. If you're dirt poor, you can get Medicaid, but the rest of us must use our savings or income to pay for long term care.

@southernhybrid If this is a risk for you, I would strongly recommend seeing a medicaid attorney (attorney specializing in Medicaid laws). We got that advice and went to one for my mother and it was incredibly helpful. Medicaid “looks back” 5 years, and so you have to be sure you have not been “giving away” your money during that time, or they will ask for it back, and you won’t have it. A terrible financial surprise. You are permitted to protect certain assets like your home and a certain percentage of your savings. But you need to find that out early, or you end up giving it all to medicaid and not being able to use the intended benefits.

Example, when I had to quit work to take care of her, if she had used her funds to help our household get by, that would have been “giving away money” and we owuld have had to pay it back when she entered skilled care. But at the attorney’s advice, we wrote up a contract where she paid me for in-home care at a reasonable market rate and she was able to use her own money to stay out of skilled care for an extra 4 years without having a government debt at the end.

There are so many rules that are intended to help seniors stay home longer, but if you don’t know them, you end up with a painful and huge debt instead of a good home care period.

 

[hurtinbuckaroo]

We've always looked for ways to cut/manage costs. We did more planning to combine errands when gas prices went up, and we still do that. We also shop at lower-cost grocery stores, as we always have, and buy things when they're on sale. We're planning to travel, so we opened an airline credit card and earned enough miles for a couple of free round-trips cross-country.

Obviously our savings are worth less now, but it hasn't caused any significant long-term damage so far. Our financial advisor did a great job of protecting our assets during the downturn.

 

[southernhybrid]

The one thing that kills the savings of older adults in long term care, so if either of us ever need, ( dog forbid ) assisted living or nursing home care, we're fucked. Medicare only covers 2 or 3 weeks of rehab. If you're dirt poor, you can get Medicaid, but the rest of us must use our savings or income to pay for long term care.

@southernhybrid If this is a risk for you, I would strongly recommend seeing a medicaid attorney (attorney specializing in Medicaid laws). We got that advice and went to one for my mother and it was incredibly helpful. Medicaid “looks back” 5 years, and so you have to be sure you have not been “giving away” your money during that time, or they will ask for it back, and you won’t have it. A terrible financial surprise. You are permitted to protect certain assets like your home and a certain percentage of your savings. But you need to find that out early, or you end up giving it all to medicaid and not being able to use the intended benefits.

Example, when I had to quit work to take care of her, if she had used her funds to help our household get by, that would have been “giving away money” and we owuld have had to pay it back when she entered skilled care. But at the attorney’s advice, we wrote up a contract where she paid me for in-home care at a reasonable market rate and she was able to use her own money to stay out of skilled care for an extra 4 years without having a government debt at the end.

There are so many rules that are intended to help seniors stay home longer, but if you don’t know them, you end up with a painful and huge debt instead of a good home care period.

I am well aware of these rules. In fact, in Georgia, unless it's changed in recent years, it's 3 years that M'caid looks back. But, I've seen many affluent people abuse the rule and I don't have it in me to do that. My mother never would have wanted that either. It makes sense if your assets are fairly small, like under 100K.

Nursing homes are expensive and without some of the residents paying the private pay rate, they would be out of existence. Of course, since our system is nearly all profit driven these days, that's another big problem with long term care. Some nursing homes and assistant living facilities limit the number of M'caid residents they will take. I've seen this in my former job.

 

[SLD]

Inflation does suck. I’ve raised the rates I charge clients but not by 5%. Yet. Like you I’ve got plenty of money but investments are flat. I’ve started putting money into cds as a result. 4.5% beats the market right now.

But I’m actually confident a bit for the future of the markets for the rest of the 20’s. There are revolutionary technologies coming on that could spur a manufacturing revolution and economic growth. The government is getting the deficit under control slowly. I suspect any recession will be short and mild.

My only worry is Republican Party destroying it all. Seriously. Another trump presidency would not help the markets. I’d probably go ahead and consider early retirement at that point.

 

[southernhybrid]

We've been retired for well over five years and we are very fortunate to be doing just fine, partly because we live in a fairly low cost area of Georgia, partly because we have always lived a little below our means and partly because we have a lovely home that has been without a mortgage for over 10 years. It also helps that this year, we got the biggest SS raise in decades. That will help and as others have said, if SS and Medicare get hurt by conservatives, we may have some problems. I doubt that is going to happen soon, and hopefully not for future generations either.

I am also waiting for the banks to release the money that my mom left me and my sisters after she died last month. We already had substantial savings, but this will add a lot to our nest egg. It is hard to not react to some of the increased prices in food, especially restaurant food, but we have the most wonderful restaurant in my small city that specializes in delicious Southern food. I can get a wonderful entree with 2 sides for 10 bucks or less, or 4 delicious vegetable sides for 8.95. The owners feed a couple of homeless people too, so we've been eating there more often lately. We don't like to travel and we really don't need a thing, other than when something breaks down, so that helps us feel very financially secure. I really don't understand greed or wanting a lot of needless material things. Sure, it's nice to have a few luxuries, but it's not a big deal not to have them.

The one thing that kills the savings of older adults in long term care, so if either of us ever need, ( dog forbid ) assisted living or nursing home care, we're fucked. Medicare only covers 2 or 3 weeks of rehab. If you're dirt poor, you can get Medicaid, but the rest of us must use our savings or income to pay for long term care.

Its pretty much accepted by all parties that both SS and Medicare will dry up in the not too distant future, unless changes are made. There is a lot of "ostrich with his head in the sand" going on right now in politics with regard to SS and Medicare sustainablity. With people not having kids like they use to to fund the needs of the elderly the situation is pretty grim for future generations. /derail.

Unless the entire economy collapses and we're heading toward Great Depression #2, something will be done. These two programs are too popular and most older adults depend on them for survival. Conservatives would lose most of the voting base, if they don't work to save SS and M'care.

There are many ways to improve the outlook. The tax could be increased by a percent, and/or maybe a special national sales tax of a penny or two could be implemented, the age of SS full benefits could be pushed up a year or the bottom age raised to 63, and we could encourage more immigrants of working age to help participate in paying into the system.

We could also end the dumbass drug war, and. tax recreational drugs to help support the social network. I think most or a high percentage of prisoners are incarcerated for drug usage. We could stop wasting so much military spending on worthless weapons that are not useful etc. etc. It's either that or watching Grandma and Grandpa sitting on the street asking for help, and standing in long lines waiting for food. If they have kids, they'd have to move in with them. I doubt that's popular in American culture. Congress will have to get its act together and come up with some plan that both sides will grudgingly support.

You started this derail, my friend.