money

Average salaries haven’t gone up (much) in 40 years.

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Having trouble making ends meet? A beer income rather than champagne tastes could be the reason.

That’s because real average salaries – wages adjusted for inflation – today aren’t much bigger than they were in 1978, according to the Pew Research Center.

Lately we hear a lot of rah-rah about low unemployment (3.9 percent), and the fact that the private sector has been creating jobs consistently (101 straight months as of July). However, the Pew study indicates that not only has wage growth dawdled, most salary gains have gone to higher-paid workers.

Workers in the private sector averaged $22.65 per hour, a gain of about 2.7 percent from last year. That’s the new normal, according to the study; in the past five years workers have seen salary gains of 2 to 3 percent.

However, average hourly earnings tended to go up by 4 percent in the time period before the Great Recession. In the 1970s through the early 1980s, it wasn’t unusual to get wage increases of 7 to 9 percent. Those were high-inflation times, however, so the money was desperately needed.

Here’s where it gets depressing, though: Our inflation-adjusted salaries haven’t gone up by much. In January 1973, average hourly wage was $4.03. Today, that would be $23.68 – and as noted above, private-sector wages currently average $22.65 an hour.

 

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Welcome, NerdWallet readers! (Here’s a coupon.)

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Thanks for finding your way to my site from Amrita Jayakumar’s article, “These young adults are debt-free – true story.” I’m not exactly young, but I was broke when I was very young and again when I was middle-aged, so I was thrilled to chat with her for the piece.

My goal was to share some of the tactics I used as a teen-ager running a household of three on a very thin margin, and later as a woman furiously treading financial water during a protracted divorce. You could say I took what I learned at age 16 and embroidered on it.

If you’re new to the site, here’s what I learned about being broke: You can make a good life on the money you currently have, without losing your dignity or your hopes for a better future.

And if you’re new to the site, let me tell you about the two books I wrote on that very topic. (Also about a way to get a free PDF of the “stealth savings” chapter from the first book.)

 

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7 money lessons from “A Quiet Place.

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Linda B. and I went to see “A Quiet Place” recently and it was as frightening as I’d expected it would be – even though I already knew a couple of major plot points, due to having read a couple of spoiler-filled articles. (Will I ever learn?)

Even when I knew what was going to happen, “A Quiet Place” genuinely scared me. That’s because these weren’t jump-scare moments or, worse, the torture porn that passes for suspense/horror these days. The underlying emotion was fear.

Fear that we can’t protect our children, or teach them enough to survive in the world. Fear that we won’t have enough to eat. Fear that we’ll lose the ones we love.

Those are some grade-A terrors, all right – and given all the recent bluster about nuclear weapons, they’re not exactly unfounded.

I, of course, also found personal finance lessons in the movie. That’s how I roll.

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Five fast financial fixes.

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This post is a second-generation copycat post. Specifically: My daughter wrote “5 fast, easy ways to improve your finances” after being inspired by a post from the Bitches Get Riches website (whose title is not ready for prime time, but definitely worth a read if you’re not averse to salty language).

Hey, if it worked for their readers, it should work for mine.

 

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Hey, Josh Radnor: You’re frugal.

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The other day I read an article about Josh Radnor, the actor who played Ted Mosby on the television series “How I Met Your Mother.” Now 43, he talked about staying in his $750-a-month sublet for the first two years of the show, even though it was a megahit.

“You don’t know, as an actor, how sustainable things are going to be, how long things are going to last,” he told CNBC.

Finally he bought a house – the last person in the cast to do so – and by the end of the series he’d made the Forbes list of the highest-paid television actors, earning $10 million (salary plus syndication bucks).

Normally I don’t write about celebs, but I want to highlight something Radnor said in the article:

“It’s not that I’m frugal. I don’t mind spending money if I believe in the thing. (But) there’s not a lot of stuff I look at in the world and say ‘Oh, man, I gotta have that’.”

As long as we’re doing TV today, I’m going to paraphrase Eleanor Shellstrop* from “The Good Place”: Josh Radnor…Ya frugal!

 

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Pinterest won’t cover your credit card bills.

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According to the “Generations Ahead” study from Allianz Life, millennials aren’t doing too badly, financially speaking.

They’re building good savings habits, thinking about retirement, etc. However, social media is doing a number on their good intentions.

Almost 90 percent of the millennials surveyed believe that social media encourages people to compare their own lives with the way other people live.

You don’t say.

More than half (57 percent) of those millennials cop to having spent money because of social media influence. That’s why I wrote “Social media will try to bankrupt you: Here are four tactics to stay solvent” over at The Simple Dollar.

 

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Cheryl paid off her mortgage.

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When I visited my dad in Tarpon Springs, Fla., last year, he and I met up with a reader named Cheryl. The three of us sat in a Dunkin Donuts talking about life and money. One of the things she mentioned was a rapid mortgage paydown.

Recently she wrote to say she is now completely debt-free, 14 years ahead of schedule.

Cheryl also included a letter she wrote to her niece, a mid-20s newlywed who’s trying to vanquish student loans. While I’m loath to throw around the word “inspirational,” this note fits the bill. That’s why I’m excerpting it:

 

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Picking up money: My 2017 gleanings.

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Another year of picking up money: change amassed from sidewalks, parking lots and the return bins of those Coinstar machines. This year it added up to $8.80.

It’s not as much as I’d hoped for, but a lot more than I’d feared. Sometimes a couple of weeks would pass between finds, and I’d wonder if I’d even manage to get $5 in 2017.

Regular readers know the drill: All year long I glean specie (and occasionally folding green) wherever I find it, and drop the cash into a vase my daughter gave as a gift when she was little. After a dozen months I count it, round it up and send a donation to the Food Bank of Alaska.

Denomination-wise, here’s how it broke down:

  • 17 quarters
  • 31 dimes
  • 10 nickels
  • 95 pennies

This time around, the food bank gets $20.

 

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How we use credit: A new federal report.

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A recent report from the Consumer Financial Protection Bureau contained a couple of concerns and a big surprise. For me, anyway.

“The consumer credit card market” states that both the total amount of credit line and the average amount of card debt have gone up over the past few years. No surprise there, given our national preoccupation with spending.

Here’s what got my attention: More people are signing up for secured credit cards, which require cash deposits. The number of secured cards provided by mass market issuers was 7 percent higher in 2016 than in 2015.

Until fairly recently most financial institutions haven’t put a whole lot of oomph into marketing secured cards. That’s changing, the federal agency notes, as consumer groups and the media suggest these cards as a good way to build credit scores.

What’s in it for the banks? Loyalty.

 

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5 money lessons from ‘Jumanji: Welcome To The Jungle.’

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They say the badness of a movie is proportional to the number of helicopters in it. Happy to report that “Jumanji: Welcome to the Jungle” has just one whirlybird, and is as much fun as the previews indicated.

The film owes a huge debt to “The Breakfast Club,” with its “detention for disparate high-schoolers” theme. This time around the teens are a nerdy hypochondriac, a gorgeous and shallow blonde, a football jock who scorns academics and a loner who’s hyper-focused on getting into Princeton.

“Detention” involves cleanup duty in a cluttered basement room. Guess what they find? An old-school video game setup. Before you can say “exposition,” they’ve been sucked into a potentially deadly game in a world that looks a lot like Oahu.

And of course I found personal finance lessons there. You would have, too.

 

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