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| Saturday, May 13, 2006 |
| Rising cost of basics |
Today's Boston Globe has the story: Study: High US debt rate can be blamed on rising cost of basics. The cause of rising American debt? Housing, healthcare, and education according to this article. In the past five years, the costs of medical care, housing, food, cars, and household operations rose 11.2 percent, the study said. Many families are trying to make up the difference by borrowing, according to Christian Weller, author of the report and a senior economist at the center. How should we cope with rising costs? Warren suggested that families that can no longer afford their single-family houses should move to condominiums, consider limiting their families to a single automobile, get second jobs, or move to less expensive school districts where children perform acceptably well. Hum... Adjust our costs to deal with financial reality? Interesting idea - but highly unpopular I am sure. Massachusetts is losing population because of our housing prices. Luckily the state still has a fairly robust job market - and if you are ok with renting you can have a comfortable lifestyle. Hopefully home prices will drop enough and wages will increase enough to reverse Massachusetts' population trend. But what about education and health care debt/costs? You can flee a housing market - but college expenses (for the young) and health care costs (for the old) - how do you escape that? |
| posted by Boston Gal @ 11:30 AM *
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i think the few years will see wage inflation [along with the regular inflation that the government is hiding from us].
its also unfortunate that most people earn a lot less than their potential.I had a friend who was earning only 30k. he wanted to start investing but he didn't have any money. I suggested he get another job - any job -waiting tables or serving coffee in the 88 hours/week you're not working or sleeping. He did that for 6 months[yes it was tough] but he managed to save 20k which he used to buy his first investment property with me in SLC. he now owns 2 houses and has found partners to help him buy 2 more.
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i think the few years will see wage inflation [along with the regular inflation that the government is hiding from us].
its also unfortunate that most people earn a lot less than their potential.I had a friend who was earning only 30k. he wanted to start investing but he didn't have any money. I suggested he get another job - any job -waiting tables or serving coffee in the 88 hours/week you're not working or sleeping. He did that for 6 months[yes it was tough] but he managed to save 20k which he used to buy his first investment property with me in SLC. he now owns 2 houses and has found partners to help him buy 2 more.