{"id":38891,"date":"2010-08-04T04:00:25","date_gmt":"2010-08-04T11:00:25","guid":{"rendered":"http:\/\/getrichslowly.org\/blog\/?p=38891"},"modified":"2023-05-22T12:12:11","modified_gmt":"2023-05-22T18:12:11","slug":"the-high-cost-of-modern-living","status":"publish","type":"post","link":"https:\/\/www.getrichslowly.org\/the-high-cost-of-modern-living\/","title":{"rendered":"The High Cost of Modern Living"},"content":{"rendered":"<p><a title=\"1953 - tv kids, snapshot by x-ray delta one, on Flickr\" href=\"https:\/\/www.flickr.com\/photos\/x-ray_delta_one\/4138924804\/\" target=\"_blank\" rel=\"noopener\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/www.getrichslowly.org\/wp-content\/uploads\/4138924804_5c10291b30.jpg\" alt=\"1953 - tv kids, snapshot\" width=\"240\" height=\"179\" align=\"right\" hspace=\"5\" vspace=\"3\"\/><\/a>With all the hullabaloo over the release of the iPhone 4 this summer, and having just paid my monthly service bill for my own iPhone (an older version, thank you very much), I thought <strong>now would be a good time to think about how much all our modern conveniences cost us<\/strong>.<\/p>\n<p>First off, buying the new iPhone might have cost you an additional $500 on top of the actual price of the phone, if you were the silly person who paid that much to take Jordan Richardson&#8217;s place in line on the day the iPhone 4 debuted, according to an Associated Press story. Richardson then paid someone farther back in line $200 for his\/her spot, making a $300 profit \u2014 but he&#8217;s still out that two hundred bucks because he couldn&#8217;t wait! I bet Jordan and his patron \u2014 now that it&#8217;s six weeks later, and a new iPhone 4 can be bought anywhere \u2014 wish they had that money back.<\/p>\n<p>But even if you were so un-hip as to not wait in 11-hour long lines or pay people to move up, you are still paying a lot for that iPhone \u2014 or just about any other cell phone, for that matter. And by \u201cyou,\u201d I mean \u201cme,\u201d since I have just such a gadget myself. Let&#8217;s look at the numbers:<\/p>\n<ul>\n<li>My monthly bill came to $73. Multiply that by 12, and you get $876 a year. But that&#8217;s not all!<\/li>\n<li>That bill was paid with after-tax money. Assuming I have a combined state and federal tax rate of 30%, I had to earn $1,251 \u2014 that&#8217;s $876\/(1 &#8211; 0.30), for those curious about the math \u2014 then hand over a chunk to Uncle Sam and Aunt Virginia (my state) to have enough after-tax dollars to pay the cell-phone bill.<\/li>\n<\/ul>\n<p>I&#8217;m certainly not alone in spending that much; plenty people spend even more, and that&#8217;s not including the cost of the phone itself. Given that the median household income in America is approximately $50,000 a year, it&#8217;s safe to say that <strong>there are people who are spending 2% to 3% of their annual income for the privilege of checking their Facebook pages in the movie theater<\/strong> while I&#8217;m trying to figure out what the heck is going on during <a href=\"https:\/\/www.imdb.com\/title\/tt1375666\/\" target=\"_blank\" rel=\"noopener\"><em>Inception<\/em><\/a>. (OK, a cell phone does more than that. For example, it might also give you brain cancer.)<\/p>\n<p>But wait \u2014 there&#8217;s more!<\/p>\n<p><em><strong>Summon your inner grumpy old man<\/strong><\/em><br \/>\nCell phones are just one of the modern conveniences that we have come to think of as necessities. As <em>Wall Street Journal<\/em> columnist <a href=\"https:\/\/jasonzweig.com\/\" target=\"_blank\" rel=\"noopener\">Jason Zweig<\/a> wrote in his thought-provoking book, <a href=\"https:\/\/www.amazon.com\/dp\/0743276698\/?tag=grsorg-20\" rel=\"nofollow noopener\" target=\"_blank\"><em>Your Money and Your Brain<\/em><\/a>, &#8220;In 1957, the average American earned about $10,000 (adjusted for inflation) and lived without a dishwasher, clothes dryer, television, or air conditioner&#8221; \u2014 and more people reported being &#8220;very happy&#8221; than do now. All these conveniences involve monthly fees, up-front purchases, regular repairs, accessories \u2014 or all the above.<\/p>\n<p>Besides not having the hardships endured in the past, kids today have all kinds of luxuries that weren&#8217;t around 50 years ago. Here&#8217;s some of the other Stuff that the past half-century has spawned to consume our money:<\/p>\n<ul>\n<li>Cable TV<\/li>\n<li>High-speed Internet<\/li>\n<li>Netflix<\/li>\n<li>Tiger Woods<\/li>\n<li>GPS devices<\/li>\n<li><a href=\"https:\/\/www.candywarehouse.com\/chocolate-covered-ants-candy-wafers-packs-24-piece-box\/\" target=\"_blank\" rel=\"noopener\">Chocolate-covered ants<\/a><\/li>\n<li>The ShamWow!<\/li>\n<li>Computers, laptops, printers, monitors, keyboards, software, cables, mice, mice pads, speakers, and assorted USB-related doodads<\/li>\n<li>Mel Gibson<\/li>\n<li>Houses that are twice the average size of houses in the 1950s<\/li>\n<li>Satellite radio<\/li>\n<li>TVs the size of waterbeds (side note: let&#8217;s bring back the waterbed!)<\/li>\n<li>e-Book readers and the books you have to buy for them, instead of getting books free from the library (can someone explain the allure of these things, because I don&#8217;t get it)<\/li>\n<li>TiVo or other digital video recorders<\/li>\n<li>ATM fees<\/li>\n<li>Magazines profiting from the inability of Tiger Woods and Mel Gibson to control their anatomical apertures<\/li>\n<li>iPods or some other MP3 player<\/li>\n<li><a href=\"https:\/\/www.nuku.co.uk\/chocolate-covered-scorpions\/\" target=\"_blank\" rel=\"noopener\">Chocolate-covered scorpions<\/a><\/li>\n<li>Security and medical alert services<\/li>\n<li>Lobbyists<\/li>\n<li>Video game consoles and their $50 games<\/li>\n<li>Handheld video game devices and their $30 games<\/li>\n<li>The SlapChop!<\/li>\n<li>iRobot vacuum cleaners<\/li>\n<li>Summer camps galore (my kids and their friends attend more camps in a summer than I did during my entire childhood)<\/li>\n<li>Additional freezers and fridges in the garage (that dispense water and ice, to boot!)<\/li>\n<li>Little blue pills<\/li>\n<li><a href=\"http:\/\/www.supersizedmeals.com\/food\/article.php\/20071218-Chocolate_Covered_Bacon_Recipe\" target=\"_blank\" rel=\"noopener\">Chocolate-covered bacon<\/a> <em>[J.D.&#8217;s note: Darn-tootin&#8217;, I&#8217;m trying this recipe!]<\/em><\/li>\n<li>Lottery tickets, which can be purchased online or through a recurring \u201csubscription\u201d (\u201cNever miss a drawing! No waiting in line!\u201d)<\/li>\n<li>Multiple digital cameras and video recorders<\/li>\n<li><a href=\"http:\/\/www.hatsofmeat.com\/\" target=\"_blank\" rel=\"noopener\">Hats of meat<\/a><\/li>\n<li>TVs and DVD players in cars<\/li>\n<li>Smoothies, Frappuccinos, Bloomin&#8217; Onions, Chia Pets (tastes sorta like parsley, or chicken)<\/li>\n<li>Child car seats and booster seats<\/li>\n<li>Prostitutes who bite your tongue (as hired by <a href=\"http:\/\/www.thesmokinggun.com\/documents\/crime\/shamwow-guy-slap-chop-bust\" target=\"_blank\" rel=\"noopener\">the guy who promotes the SlapChop and the ShamWow<\/a>)!<\/li>\n<li><a href=\"https:\/\/www.amazon.com\/dp\/1608870154\/?tag=grsorg-20\" rel=\"nofollow noopener\" target=\"_blank\">Books that explain what the heck was going on during <em>Inception<\/em><\/a><\/li>\n<li>Gym memberships<\/li>\n<li>Children<\/li>\n<li><a href=\"https:\/\/www.istockphoto.com\/photo\/woman-covered-in-melted-chocolate-and-licking-finger-gm108194877-5131480\" target=\"_blank\" rel=\"noopener\">Chocolate-covered women<\/a><\/li>\n<\/ul>\n<p>Not all these items are luxuries. Many enhance safety and productivity, and provide just the right combination of sweetness, crunchiness, and antennae-ness. Plus, since average household income has quintupled, we can afford more Stuff.<\/p>\n<p>On the other hand, <strong>the list also demonstrates why some people might have trouble saving money<\/strong>. I often receive emails from readers who are in the second half of their working careers and yet have saved very little for retirement. A while back, I read a <em>Washington Post<\/em> article about a family that was struggling financially, including this description of their life: &#8220;The house is small, and the blare of Nickelodeon from the TV chokes the day.&#8221; Of course, Nickelodeon can only be accessed by paying for cable TV (a luxury we finally succumbed to last January).<\/p>\n<p>My point, dear reader, is that <strong>there is a current and future cost to the modern lifestyle<\/strong>. For every dollar we earn, we could rightfully ask: &#8220;Do I want to spend a dollar today and work longer, or do I want to spend a few dollars in the future (<a href=\"https:\/\/www.getrichslowly.org\/power-of-compounding\/\">assuming some compound gowth<\/a>), when I no longer have to work?&#8221;<\/p>\n<p>For some purchases, we&#8217;d undoubtedly still spend the money today. However, others may be providing less current satisfaction than what that money could provide in the future. Just something to think about. I know I&#8217;ll keep it in mind when my cell-phone service contract runs out this spring, and I evaluate whether the $1,251 I have to earn every year for it is worth the $102,609 I could have (assuming a 6% annual return and 3% inflation rate of the cost of cell service) 30 years from now.<\/p>\n","protected":false},"excerpt":{"rendered":"<p><a title=\"1953 - tv kids, snapshot by x-ray delta one, on Flickr\" href=\"https:\/\/www.flickr.com\/photos\/x-ray_delta_one\/4138924804\/\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/www.getrichslowly.org\/wp-content\/uploads\/4138924804_5c10291b30.jpg\" alt=\"1953 - tv kids, snapshot\" width=\"240\" height=\"179\" align=\"right\" hspace=\"5\" vspace=\"3\"\/><\/a>With all the hullabaloo over the release of the iPhone 4 this summer, and having just paid my monthly service bill for my own iPhone (an older version, thank you very much), I thought <strong>now would be a good time to think about how much all our modern conveniences cost us<\/strong>.<\/p>\n<p>First off, buying the new iPhone might have cost you an additional $500 on top of the actual price of the phone, if you were the silly person who paid that much to take Jordan Richardson&#8217;s place in line on the day the iPhone 4 debuted, according to an Associated Press story. Richardson then paid someone farther back in line $200 for his\/her spot, making a $300 profit \u2014 but he&#8217;s still out that two hundred bucks because he couldn&#8217;t wait! I bet Jordan and his patron \u2014 now that it&#8217;s six weeks later, and a new iPhone 4 can be bought anywhere \u2014 wish they had that money back.<\/p>\n<p>But even if you were so un-hip as to not wait in 11-hour long lines or pay people to move up, you are still paying a lot for that iPhone \u2014 or just about any other cell phone, for that matter. And by \u201cyou,\u201d I mean \u201cme,\u201d since I have just such a gadget myself. Let&#8217;s look at the numbers:<\/p>\n<ul>\n<li>My<br \/>\n","protected":false},"author":1422,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[496],"acf":[],"_links":{"self":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/posts\/38891"}],"collection":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/users\/1422"}],"replies":[{"embeddable":true,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/comments?post=38891"}],"version-history":[{"count":0,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/posts\/38891\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/media?parent=38891"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/categories?post=38891"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}