We're 80! What did things cost in 1937, the year we were born?
We're 80 years old this month, and taking an opportunity to reflect on what the world was like in 1937, the year we were born.
One of the most remarkable things to consider is how much commonplace items like milk or gasoline cost our members in 1937 vs. the cost for the same things today.
1937 vs. 2017
Average cost of new house $4,100 vs. $379,800
Average wages per year $1,780 vs. $44,600
Cost of a gallon of gas $0.10 vs. $2.25
A gallon of milk $0.10 vs. $3.98
Average cost for house rent $26 / month vs. $1,300 / month
A loaf of bread $0.09 vs. $2.31
A LB of hamburger meat $0.12 vs. $4.97
Average price for new car $760 vs. $32,000
Tuition at Harvard $420 / year vs $43,280 / year (before room + board)
Movie ticket $0.25 vs. $10.49
Let's talk about inflation
The impact of inflation is easy to see over the course of 80 years! It acts like an invisible force, pushing up the price of things slowly and gradually. Over time, inflation can erode our purchasing power, having an especially negative effect on saved money. If, for example, you'd have saved up enough money in 1937 to purchase a house, then kept that money under a mattress until 2017, it would only buy about 1% of a house now according to the figures reported above.
Investing to Outpace Inflation
Saving money in an interest bearing account or investing are common strategies to help combat the cumulative effects of inflation. While you’re in the thick of your income earning years, one way to outpace inflation is to increase income to keep up with inflation.
Contact a Logix Financial Service Representative if you're interested in learning more about outpacing inflation with interest-bearing savings accounts at Logix.
A note from Logix: Occasionally, Logix will invite guest bloggers to post on assorted financial topics. These posts may or may not represent our views.