October 20, 2013

Higher Prices, Lower Wages

There was an article in the Des Moines Register today that confirmed what everyone already knows, prices have gone up.  The premise of the article was that many people have not recovered from the Great Recession because prices have gone up and wages have gone down.  Okay, I already knew that, but the article gave statistical information which I found quite interesting.

In Iowa the median household income in 2007 was $52,371 and in 2012 was $50,957.  In the U.S. as a whole the median household income in 2007 was $56,189 and in 2012 was $51,371.  Americans are paying about 12.5% more for household goods.  In 2007 a pound of ground beef cost $2.40 and in August of this year a pound cost $3.46.  A loaf of whole wheat bread in 2007 cost $1.71 while in August of this year a loaf cost $2.04.  A pound of coffee was $3.50 in 2007 and in August of this year a pound was $5.21.  Gasoline has consistently fluctuated over the past few years and has increased to the point that it was not uncommon in Iowa to pay an average of $3.37 by the end of August this year.  Fortunately as of today, the price of a gallon of gas in our area is $2.97. 

Many Americans continue to feel the pinch as they are still cutting back, have tried to adjust to lower wages, higher costs, have lost their homes, jobs, are having problems paying their mortgage and have increased credit card debt in order to pay basic bills. 

The recent fiasco in Congress created more financial problems for many people which has led me to believe this:  we are on our own people.  I have stated this recently on this blog.  While thankfully there are programs that can be helpful for families, many people don’t want to have to need these programs.   It is comforting that they are there to help but when the government shut down occurred some of these resource programs were suspended such as the W.I.C. program (Women, Infants and Children).

I believe it is becoming the responsibility of each of us to take care of each other.  If you have a little extra and you have a neighbor in need, it is up to us to take care of our neighbors.  Sometimes we may not have a lot, but a loaf of bread or a half a gallon of milk can go a long way for someone who does not have much.

Recently I had an individual comment and ask what I am doing to combat higher prices.  I cut out some frills in our budget such as getting my nails done and working out at Curves to help our budget, but there is more that I can do.  I have become a little lax, but with retirement only 13 years away and the desire to continue to be a stay at home wife and grandmother, there is more I need to do. 

You know what it is like, you sacrifice for such a long time, you need a vacation from the sacrificing.  You get tired of counting pennies and you just want to go out to a restaurant and spend some money on a great meal.  I have been there.  Funny thing is this:  I can buy a 16 oz. steak on sale for $6.99 (recently $4.99), cut it in two, grill it, add a potato, small salad and a homemade dessert for a lot less than I will spend for the two of us at a great restaurant and it tastes better.  The same is true if I marinate some inexpensive chicken breasts and grill them with some vegetables.  The point is that sometimes you need to take a break from the scrimping but you don’t need to throw the budget out the window.  Sometimes it is creating a special meal and serve it by candle light OR as we did when our kids were little, having pizza on a blanket on the living room floor in the winter  - our version of a winter picnic.

When it comes to scrimping and getting the most out of your hard earned money, there is one thing that will save you a lot:  being aware of what you are doing daily.  I know it sounds weird, but think about it.  Are you aware when you run the water for a shower or bath how much water you are using?  When you squirt dish soap into the dish pan to wash dishes, are you using too much soap, the same being true for dishwasher detergent? When you cook a casserole could you get by with using less meat and more vegetables or pasta and rice?   Instead of purchasing ice cream bars and cones as a treat, buy a half gallon of ice cream on sale and put it in your own cones.  Sprinkle a few inexpensive sprinkles on top and you have a cheap treat for your kids.  Treats are great to keep us going during hard times.

One thing I know is a fact, you can still get great results in cleaning products by using less.  You can save even more money by making your own products or by using plain water to clean extremely dirty windows and then spritzing on the cleaner to finish them off.   The same is for dirty services of any kind.  Get the dirt or grime off as much as possible with warm or hot water and then spritz on the cleaner at the end to finish the cleaning process.

Be aware of what you are doing throughout the day and you will find ways to save money.  

As far as combating food prices, my main tool is my freezer and a storage space for pantry items.  Buying meat and frozen vegetables when they are on sale is a great tool.  If you only have the freezer above your fridge to use, then use it for expensive food items that go on sale such as meat. 

I am a believer in Ivory bar soap.  I can get it on sale with coupons all the time for about 15 cents a bar.  I am steering myself away from the shower gels which are costly.  I don’t need the fragrance as I spritz on a very light amount of perfume after I dress.  No need for the scents of a shampoo with a shower gel and then a lotion along with perfume.  Don’t buy into all of the hype and instead find a bar soap that is cheaper that you like. 

When I am at the store if I need a product and don’t have a coupon, I always give the store brand a try.  This is true for many items.  I am not brand loyal and I am always looking for a cheaper alternative.  For basic items such as canned tomatoes, pork n beans, and such I can virtually not see or taste a difference especially when these items are going into soup, chili and casseroles.  I have always added my own ingredients to pork n beans (ketchup, mustard, brown sugar and vinegar).  Why would I care if they are name brand, store brand or generic?  The same is true of laundry detergent.  If I get a name brand on sale at a really great deal, I buy it (during the summer I can get a great deal on Tide).  I reserve a bottle of  Tide, Wisk, Oxydol or other name brand for those wicked stains that won’t come out.  Then I mix the rest half and half with a store brand that I get on sale.  Once a year a store here in town has their store brand detergent on sale for $1.00 or less for a 29 load size.  I have also done the same with mixing sale bought name brand powdered detergent with the Fels Naptha powdered laundry soap recipe.

I use ivory bar soap (rub it into the stain and let it sit) or a small amount of liquid Dawn dish detergent for pretreating stains.   And since we are on the discussion of laundry, does each family need a ton of clothes in their closets? 

If you have children in the home and you are working, you will have a much more difficult time in saving money because you are busy and you may not have the time to do some money saving tasks.  I am going to address this in another post this week as I have been there and I am also there a little bit now with watching my grandson 4 days a week.  What questions do you have about saving money in general or in a specific area?  What help or ideas do you have or need?  Where are you at in your household budget?  Are you discouraged and struggling?  We may be facing a different America than was there 20 or 40 years ago, but if you are willing to put forth effort and keep a smile on your face, you can make it.  It is sometimes about attitude and the willingness to not give up. 

Leave a comment and I will address them.  


Meg B. said...

The fact is that if we are frugal in the abundant times, deliberately living within, indeed, beneath our means, the lean times will make little difference in our circumstance. Sure, maybe my kids might like a pair of expensive jeans. Maybe they feel a bit of pique that I won't purchase them. Life goes on much as before. However, if things changed drastically because of, say, job loss...all of a sudden there is not only no money fir the expensive jeans, but no food in the house, no money for gas, no money for housing, why their worlds would turn upside down. Financially secure and debt free, our lives vary little from our younger saving days. Oh sure, there have been trips and property purchases, kids get lessons of their choosing if they can prove commitment, but we still run the house in the same manner. Of course, now I am cutting edge, as these methods are so green! Wasn't so cool 20 years ago. Great post. Thank you

Anonymous said...

Great post. We do need to help each other out when struggling. I think the gov't shutdown has most people rethinking their finances. Stocking up on food is a good idea. I grew up poor and remember a time when we only had margarine to eat. Now when I feel the need to buy something frivolous I try to remember not having food to eat as a child. I do try to donate foodstuffs to my local temporary aid center (pantry).

Patti said...

I live in Illinois, probably the worst state in the nation financially. Today gas was $3.49 on the cheap end,ground beef $3.99 on sale and our sales tax went to 9%. I live in a 63 yr old 1500 sq ft home and my property taxes are $7200.00 a year.I pay more each month for them than my P&I.Our schools are receiving less and less from our state which translates to the taxpayers paying more out of pocket. I lost my job 5 years ago and am now cleaning homes 5 days a week. I'm 50 and glad that I still have it in me to last all day. My husband can retire early in 3 years and we're moving to another state. We have saved and done without all our lives but that still won't be enough. Time to bring the jobs back home and make EVERYONE pay their fair share. No more tax breaks to the tax dodgers of this country!!!

Anonymous said...

The Affordable Care Act and the rising costs of all kinds of insurance means it's getting harder and harder to budget. My deductible for my condo disaster insurance went from $1000 to $15 000 last year. Not a typo! This year I learn my health insurance premiums on the government website are $2500 a year, with an additional $6000 out-of-pocket expenses. No amount of re-organizing finances can cover these kinds of expenses for ordinary people.
And I resent working hard and living carefully for years to try to provide for myself into old age only to find I would be better off now to give up work and sign up for benefits.