Why does it feel like people have unlimited budgets, even with crazy inflation?

[Anonymous]

Anonymous wrote:When you have a 2016 PITI, inflation doesn’t pinch that bad. Especially if you stayed climbing the corporate ladder.

This. Homeowners have it made.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Credit card debt levels and defaults are at record levels OP, that's how.

Rich people aren’t living in credit cards. That’s just non rich people trying to keep up.

DP but that’s *literally* the point. No one claimed the people spending are rich. “Why do all these people have seemingly unlimited access to goods and services?” Cuz they have credit cards, not because they’re rich.

That’s not an infinite source of funds. Credit cards have limits and at these rates no one can keep huddling them forever. It’s not sustainable.

[Anonymous]

OP here, we have a good mortgage with a low rate and have already owned the house 10 years. I realize that is lucky. But our incomes have only gone up slightly the past several year and not nearly the amount of inflation. We’ve postponed plans for a new car and home renos and downgraded our travel. It doesn’t seem like anyone we know is doing the same though.

[Anonymous]

People are in debt up to their eyeballs. For example, the average new car payment is $700 and the average car payment is $500. An iphone is $1200 and stops getting updates in 5 years. THe list goes on an on. Corporate America is fleecing us and convincing us we need the latest and greatest and only offering luxury items by and large. No one seems to notice. At least until the next crash.

[Anonymous]

Anonymous wrote:People are in debt up to their eyeballs. For example, the average new car payment is $700 and the average car payment is $500. An iphone is $1200 and stops getting updates in 5 years. THe list goes on an on. Corporate America is fleecing us and convincing us we need the latest and greatest and only offering luxury items by and large. No one seems to notice. At least until the next crash.

iPhone obsolescence is the biggest scam

[Anonymous]

So so glad I got my car for $28K in 2027 and paid it off in 3 years. No car payment is amazing. I just wonder how long the thing will last. It’s at 60K now fingers crossed.

[Anonymous]

Anonymous wrote:I just went to the bakery and got a single serve cherry crumble, a salted caramel bar and a croissant. It was $24.

I am panicking about the future.

You should also be panicking about your waistline.

[Anonymous]

You can only see "consumption"; you can't see "wealth" or "saving". Lots of people overspend and people conflate high consumption with high wealth.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I just went to the bakery and got a single serve cherry crumble, a salted caramel bar and a croissant. It was $24.

I am panicking about the future.

You should also be panicking about your waistline.

Lol the cherry crumble was for the kids and it was all I ate until dinner so I am good thanks. BMI 18 here.

[Anonymous]

I can just speak for us, HHI increased by 40% in the last two years, promotion and job change. Plus kids are now in high school .. so making a bit for time lost regarding vacations and more classes for kids sports, tutoring are the two places we are spending more. The kids now have very busy schedules so family dinners once a week outside have now become take outs (they cost the same). otherwise our mortgage is just the same … and we are saving much more even with everything going up …classes, bi weekly cleaners, food etc

[Anonymous]

Anonymous wrote:I was just reading an article about a young woman working at Target and said she sees others doing $500 runs and she doesn't even make $500 every two weeks. I felt so sorry for her. She doesn't realize though that the amount could be a monthly stock up. Or that kids cost a lot especially in the food category. And it can't be helped right now. Shit is getting more expensive. WEEKLY. It's hard for a lot of people. Throw in gas and the struggle becomes real. And scary.
My adult kids wouldn't make it if we didn't help. The kids need shoes and clothes. With both adults working they still need help.
Our extended family would not make it if we didn't help. There is no extra.
That's the main reason we took SS early. Our monthly drawdown covers our expenses. The rest is for them.
The ones that have have. The ones that don't need help.

You sound like a classic enabler.

[Anonymous]

Going by the data, inflation is a real concern for most Americans. Most people's incomes haven't kept up with inflation so real buying powers have declined. Contrary to what a poster said on the first page, not everyone got massive salary increases. 5% each year is more typical, but that doesn't keep up with inflation.

There's already economic data showing the inflationary bites leading to slowing consumer spending. Quite often it takes a while for that to catch up with people. CC debts are increasing, car reposessions are increasing, housing sales are down in volume, and not just because of a shortage of inventory.

We could be singing a different song by end of year. But I do think your concerns reflect that America is moving towards haves and have nots. That's been the case for a long time. Inflation is manageable for the haves. The have nots are starting to struggle.

[Anonymous]

Anonymous wrote:Going by the data, inflation is a real concern for most Americans. Most people's incomes haven't kept up with inflation so real buying powers have declined. Contrary to what a poster said on the first page, not everyone got massive salary increases. 5% each year is more typical, but that doesn't keep up with inflation.

There's already economic data showing the inflationary bites leading to slowing consumer spending. Quite often it takes a while for that to catch up with people. CC debts are increasing, car reposessions are increasing, housing sales are down in volume, and not just because of a shortage of inventory.

We could be singing a different song by end of year. But I do think your concerns reflect that America is moving towards haves and have nots. That's been the case for a long time. Inflation is manageable for the haves. The have nots are starting to struggle.

+100

This is one of the biggest bullshit DCUM myths out there, that everyone just got massive pay raises during Covid (one poster above said 40%). If you got that, great for you. But the data shows that real incomes (i.e., after adjusting for inflation) for most people just keep going DOWN month after month after month.

[Anonymous]

Anonymous wrote:People are in debt up to their eyeballs. For example, the average new car payment is $700 and the average car payment is $500. An iphone is $1200 and stops getting updates in 5 years. THe list goes on an on. Corporate America is fleecing us and convincing us we need the latest and greatest and only offering luxury items by and large. No one seems to notice. At least until the next crash.

Huh? My iPhone 7 Plus, purchased in 2017, receives regular updates and is working just fine.

[Anonymous]

Anonymous wrote:

Anonymous wrote:People are in debt up to their eyeballs. For example, the average new car payment is $700 and the average car payment is $500. An iphone is $1200 and stops getting updates in 5 years. THe list goes on an on. Corporate America is fleecing us and convincing us we need the latest and greatest and only offering luxury items by and large. No one seems to notice. At least until the next crash.

Huh? My iPhone 7 Plus, purchased in 2017, receives regular updates and is working just fine.

My 2019 phone died utterly and completely earlier this year. And I took good care of it. Phones are not designed to last more than a few years, which is why batteries start declining sharply after year three or thereabouts, camera quality declines, and the phone's ability to keep up with app upgrades declines too. If you're on year six of your iPhone, consider yourself very lucky!