Posted on 01/19/2023 1:43:10 PM PST by fluorescence
Consumer spending slowed and household finances weakened across all income levels last month. But households earning $100,000 a year or more reported shaving more off their spending than less well-off households did, according to a report released this week by Morning Consult, a decision intelligence company.
The report also found that real monthly spending among U.S. adults fell by 4.3% from November to December. Even so, 21.3% of U.S. adults said their monthly expenses exceeded their monthly income in December, up from 19.2% in November.
On average, households earning $100,000 a year or more said they spent about 10% less in real terms in December than they did the previous month. Households earning $50,000 to $99,999 and those earning less than $50,000 a year, meanwhile, reported that they cut their monthly spending bills by no more than 5% on average.
Across the board, households are cutting back on recreation, alcohol, vehicle insurance, and other services in December, while spending more on hotels, gas and airfares, the report found.
One theory on the spending cutbacks: Higher earners typically have more discretionary income, and likely have decided to exercise more fiscal caution after seven interest-rate hikes by the Federal Reserve last year. (On Wednesday, St. Louis Fed President James Bullard told The Wall Street Journal in a live-streamed interview that the Federal Reserve should not “stall” on raising its benchmark rates until they are above 5%.)
The Morning Consult report did cite inflationary pressures. “Heightened budgetary pressures brought on by persistently high inflation are forcing trade-offs for consumers, leading to reallocation across categories,” it said. “For instance, as food grew more expensive over the past year, U.S. households accommodated an increase in grocery purchases by spending less at restaurants.
(Excerpt) Read more at marketwatch.com ...
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I've been waiting for years.
Surprised we keep muddling through as well as we have for so long, actually.
Home brewing can definitely be cheaper. There is some time involved, but it’s a hobby. My next is a wheat dunkel. Cost of $45. It has a ton of ingredients. Ugh. I have a case of tripel fermenting. It cost me less than $25. I don’t mind some mass produced beers, but yeah, I’d rather splurge a little for something really good.
“Another possibility, which is true for me, is to cut back on collision and comprehensive. My car is 16yo and any dent is going to “total” it, with remuneration below $1k, so that portion of the insurance isn’t worth it; I’ll drive carefully and sock away the difference.”
Absolutely!
Have carried liability only on cars for more than 40 years.
Even on some 2 and 3 year old cars. Have saved a lot of money.
Did you know any airbag deployment and the ins co totals the car?
A vehicle is the sum of its components and parts. But the ins co gives pennies for an older car no matter if a rolling junker or not, they do not care.
I could not afford 2 cars if fully insured, I have way more than 2 cars......
People who earn 100K per year are far from well off. Now those that get to keep 100K per year, after taxes, night be. But even they are most likely stretched as well. With inflation the responsible people will cut their expenditures to have extra resources for emergencies that arise.
Great post. I am going to try it with pizza sauce.
I take spaghetti, sesame oil, chili crisp and peanut butter and make sesame noodles. Toast some sesame seeds and toss them on top. Cheap eats.
High income people have much more discretionary spending. Many of them are apprehensive about the near and midterm future and are cutting back. Lower income people are buying necessities.
A 100 large ain’t much these days when you have a good size family, mortgage, car payments, etc...
Agree...I remember back when 6 figures was a milestone, now it just another bracket of mediocrity.
Accumulating cash, while patiently waiting for the stock market to tank so they can gobble up the oversold quality stocks.
Ain’t that the truth
Busted my ass and broke that mark in the mid 90s and felt quite well off
Make considerably more these days and don’t feel like I live near as well
Yeah good and such has been an issue this year
We try to eat really clean and healthy and it’s become outrageously expensive to do so
There is less room to cut in a small budget then in a large one.
Not sure why this would puzzle anyone.
There’s also the fact that you are supposed to use some of the pasta water in the sauce, cook the pasta just a minute under the pkg directions for al dente then finish 2 minutes directly in the sauce which allows the sauce to cling to the pasta without it being a certain shape.
Ethan Chleboski is the new Alton Brown.
On french bread, look up Ethan Chlebowski. It takes about 4 hours total and you have to do the stretch and fold technique several times.
I’ve recently retired from my main gig so I’ve returned to the culinary arts. Baguettes (actually sandwich sized—authentic are 24” long) came out great.
we wuz poor....we didn't have olive oil, just vegetable oil and we used "oleo".(margarine)
oh, and we also used tin foil.....
grind up some fennel seed...that’s what really gives it the flavor.
us too....am not buying anymore paper towels and when my current crop of paper napkins are gone, we’re going to cloth...all of us probably use too much laundry soap, dish soap, shampoo, etc....I just want to live more simply and less dependent.
how do you find the Buy Nothing Project?....can I participate only from my lap top which I prefer over my lousy “smart” phone?
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