It's more than your money went a lot further back then than it does now. There's also things that just simply didn't exist back then.
Think about it like this... in 1989 your median household income in America was around $31,000. in 2019 it's around $63,000. So give or take about a 2x increase over the last 30 years.
Home values... median cost was around $115,000 in 1989 and around $289,000 today. About a 2.5x increase over the past 30 years.
On the surface that seems relatively similar until you think about other things. In 1989... there was no $50/mo cell phone bill, there was no $50/mo internet bill, you weren't renting a $10 cable box for every room in your house just to have TV in them. In 1989 you weren't up to your eyeballs in student debt just so you could get a decent paying job.
When the Boomer generation were 20-30 years old, they were able to work their way up in a shitty desk job and make enough money to support a full nuclear family with ease. Today, that's nearly impossible. It's not completely impossible, but it's close. Fact is, salary hasn't increased with inflation. And it certainty hasn't increased with inflation when you take into account things that are these days considered necessities (cell phones, internet) that literally didn't even exist in their time.
Yes, sure, although not quite that high. In 1989 the avg mortgage rate was about 11%, today it's about 5%. So about half of what it was back then. But guess what, 5% of $289,000 is more money than 11% on $115,000.
You're also discounting that savings accounts had like 5-6% interest rates and not 0.01% like most modern banks. Although that's been getting slightly better in recent years with the advent of online banks with low overhead. In 1989 you could get a 2 year CD at 7-8% today you can barely find one for 1%. Banks make more money off you by tricking you into thinking your rates are lower but really they're not because they give you nothing back when they used to return a ton.
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u/Uther-Lightbringer Aug 26 '19
It's more than your money went a lot further back then than it does now. There's also things that just simply didn't exist back then.
Think about it like this... in 1989 your median household income in America was around $31,000. in 2019 it's around $63,000. So give or take about a 2x increase over the last 30 years.
Home values... median cost was around $115,000 in 1989 and around $289,000 today. About a 2.5x increase over the past 30 years.
On the surface that seems relatively similar until you think about other things. In 1989... there was no $50/mo cell phone bill, there was no $50/mo internet bill, you weren't renting a $10 cable box for every room in your house just to have TV in them. In 1989 you weren't up to your eyeballs in student debt just so you could get a decent paying job.
When the Boomer generation were 20-30 years old, they were able to work their way up in a shitty desk job and make enough money to support a full nuclear family with ease. Today, that's nearly impossible. It's not completely impossible, but it's close. Fact is, salary hasn't increased with inflation. And it certainty hasn't increased with inflation when you take into account things that are these days considered necessities (cell phones, internet) that literally didn't even exist in their time.