Where does YOUR money go?
The New York times just released some interesting data that shows a breakdown of how Americans on different levels of the wealth spectrum are spending their money.
There are a few particularly telling things about the data. I’ll let you check it out for yourself since it’s most definitely worth a look, but what initially struck me is that the lowest income quintile (that’s the bottom fifth of households) is actually consuming over $8000 more than they make on a yearly basis. In other words, at least 1/5th of American households can’t afford to maintain their current lifestyle with what they’re earning. So where’s all this extra money coming from? Do you really need to ask? Cashing in insurance policies, drawing down equity on homes and taking out loans of ever increasing magnitude.
There’s also a fantastic chart that shows the spread of common household consumer goods over the last century. If you cringe at the thought of going without broadband or cable TV, keep in mind that a mere 60 years ago, roughly half of American households didn’t have a car, telephone, refrigerator, or even a stove!
While I think I’ll hang on to my stove, it certainly makes me think hard about what in my life is a necessity and what is a luxury. Maybe I can live without Tivo after all!
Check out the article here.
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