Basic Costs Squeeze Families Health Care, Cellphones Eat Up Income.....(Wall St Journal)

wsj. ^ | Dec 1 | By Ryan Knutson and Biography ryan.knutson@wsj.com @Ryan_Knutson Google+ Theo Fran

[dennisw]

The American middle class has absorbed a steep increase in the cost of health care and other necessities as incomes have stagnated over the past half decade, a squeeze that has forced families to cut back spending on everything from clothing to restaurants.

Health-care spending by middle-income Americans rose 24% between 2007 and 2013, driven by an even larger rise in the cost of buying health insurance, according to a Wall Street Journal analysis of detailed consumer-spending data from the Bureau of Labor Statistics.

That hit has been accompanied by increases in spending on other necessities, including food eaten at home, rent and education, as well as the soaring cost of staying connected digitally via cellphones and home Internet service.

With income growth sluggish, discretionary spending on things like clothing and movies, live shows and amusement parks has given way.

The data—drawn from 14,000 households that either keep diaries on their spending for two weeks or agree to quarterly interviews—helps explain why so many retailers are turning in persistently lackluster results, and why the household-products business has shown virtually no growth for years. It also helps illuminate why the consumer-led U.S. economy has been so slow to rebound from the financial crisis.

[Marie]

Also debt free! :)