Hopefully you had the chance to watch your favorite Christmas movies! You might remember the scene in Home Alone, when Kevin goes to the grocery store by himself. He loads up his cart with all essentials to survive at home without his family. He bought:
-Four pack toilet paper
-Wonder Bread
-Reynolds Wrap
-Kraft Mac ‘n Cheese
-Tide laundry detergent
-Snuggle fabric softener
-Whole milk
-Tropicana OJ
-Frozen turkey dinner
-Pack of toy soldiers
In 1990, he spent a total of $19.83 (including a $1 coupon). We saw an article recently where a reporter went to a local grocery store in Chicago near the McCallister’s house and found that those same items today cost $72. We did some online shopping at Target and Walmart and found we could get everything for about $54.
These are obviously just estimates since a lot has changed in the last 30 years, like the portion sizes, quality and so on. But regardless, anywhere in that ballpark is a HUGE jump.
If you look at the US Consumer Price Index just for food, it actually says food prices and average hourly earnings both rose almost exactly 80% since 1990. So, it implies that wages kept up with food inflation. But, the shopping list that Kevin bought in Home Alone went up dramatically higher. This is partially because Kevin only bought a handful of items, which happened to go up at a much faster rate.
As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.
-Vivi & Shane
