By: Chrysa Smith

I’m officially old.

While cleaning, I found one of those birthday cards that talks about what happened the year you were born. Let’s see—the Douglas DC8 was advertised as the world’s most romantic jetliner, “Dinosaurs” was playing in “Cinemascope,” the “Comet” was the hip car of the day–and yah, the average income was $5199/year.

The year was 1960—54 years ago, and what struck me most potently was not that bacon was .65/pound or eggs .30/dozen. What struck me was that the average price of a new home was $12,675. Not only would that cause most of us to say, “Yah, I’ll take five of those,” but it’s a striking example of inflation. According to the US Bureau of Labor, the average household income  in 2012 was $51,371. Let’s see, that means that it took one person about two years to afford a new home half a century ago. It takes two people, roughly six or more years to afford a new townhouse today. I’d venture to say that in S.E. Pennsylvania—and in Central and Lower Bucks, it’s closer to nine or ten years for a nice single family home.

We have it better? Well, we have bigger TV’s, fancier cars, nicer handbags. But when it comes to having real assets, how well do we really stack up? I don’t know about you, but when my aunt (a widow who had no children)  passed away last year, she left substantial amounts of money to six of us nieces and nephews. While she did live in an apartment most of her life, she took nice vacations, helped out family members, wore nice clothes, drove a nice car and went out with her friends often and freely.  I never expected anything from her; certainly never a substantial chunk of change that I manage with the care of a Swiss Banker. And I was only one of six who she left with the same gift. How on earth did a blue collar family, with blue collar jobs, manage to accumulate so much for their family?

Well, I’d venture to say that they didn’t have $2000 mortgages, $300 car payments, $15,000+ college tuitions, $3+/gallon gas (which for some reason, nobody even talks about), $100/week grocery bills (at least for our family of 3 humans and two poodles, without buying meat for human consumption), higher healthcare premiums (thank you, Obamacare), $10 movie tickets—-well, you get the idea. Everything is up. But back to housing costs—-really? Should we really be paying six or more times the family income in order to just live in a 3br/2bth single?

It’s no wonder that when I look at people who have shore houses, they were purchased decades ago. Much of the time, also by blue-collar families who were able to afford their primary homes and a little place down by the ocean—for vacation. If you were to contemplate that now, if it costs six or more times for a nice home in the Greater Philadelphia Area, it would probably cost about ten+ times the average household income just to own a second home—smaller home; often a one-level condo, seaside.

So, we make more, but get less. We have more, but accumulate less. We want more, but often have less of lasting value than many of our ancestors. That’s a sad story. And from where I stand, unless something changes dramatically, it’s not getting any better.

My son, who just graduated from Penn State is working with his dad. It’s great experience—he’s doing more interesting work than most of his friends. He’s actually doing the marketing he studied for in school. He’s learning multiple computer programs, designing websites, shooting videos. It’s all good, but as he said just today (after getting a call from a distant acquaintance & financial planner), “I think it’ll be awhile before I need a financial planner—can’t do much of that on $600/week.”

I made $15,600 when I graduated college in 1982, and I was buying custom handbags, pink heels and clothes from Saks. Just saying, times have changed. And the American dream has been amended or delayed—if not lying in the ER.

Please tell me things will get better. I don’t want to try and save for the future, while subsidizing my son, a future wife, kids and a Newfoundland  (his favorite breed of dog)—-

If you’re doing ok, do you feel like you’ve stalled? Have you put away enough for the future? Are you managing to save? Are you comfortable thinking about retirement?