My Debt Blog

The mainstream news media never ceases to amaze me. Recently the New York Times published an interactive chart on their website, All of Inflation’s Little Parts which is a visual representation of consumer spending and inflation.

Below is the breakdown of what the average consumer will spend their income on annually. I took note on some of the areas that peaked my interest:

• Housing 42% It puts 2.4% for vacations in this category for some reason. Meanwhile home owners spend about 24% of their income on their home.
• Transportation 18% Gas prices are 5.2% of our annual income, which is up 26% so we’re only paying a quarter more for gas. If you break that down, it’s about $550 more a year on 40k income, that’s $45 more per month. There’s way too much hype and panic over gas prices.
• Food and beverages 15% Adding 2 categories together, this thing shows the average consumer blows 5.4% of their income on eating out! This might have something to do with the health care costs going up.
• Health care 6% The skew in this graph is that prescriptions are 1.5%, doctor and hospitals make up 2.6%, yet we only pay 0.5% to health insurance? Maybe I’m looking at it wrong but health care costs are something that needs to be taken seriously.
• Education/Communication 6% College costs up 6% which is near twice the average inflation rate. If my generation is Gen Debt from large student loans than what generation will my children be stuck in, Gen BK?
• Recreation 6% Cable makes up the largest single component of this area at 1.2%. The media obviously can’t report this to you because they need you to watch them lie to your face and work up your emotions.
• Apparel 4% This area is a bit sexist because the women’s categories are broken up into a few things, and men has about 5 or 6 categories. Both sides are 1-1.5% but they make it look like women spend more money in this section.
• Miscellaneous 3% Obviously tobacco products take up the largest slice of this area at 0.7% on the average consumer. If a person making 40k a year stopped smoking, they would have an extra $280 a year to save or invest. Again this could be related to the health care costs too.

Feel free to look at the chart and let me know what you find interesting.