Talk about money with parents of young children these days, and it's hard to find good news. Daily life keeps getting costlier, they say — tuition, doctors, mortgage payments. Even the best window-office jobs no longer come with the pension plans that had our parents living by golf courses by age sixty-five. People are concerned.
Some are grateful to earn double what their parents once did. But that's little help when homes can cost ten times what our parents paid for theirs. With tuition, it's more than just the colossal cost of college. It's immediate things, like fat bills for preschool. What we once called "nursery school" was optional a generation ago. Today, even kids with a stay-at-home parent often begin preschool by age two. Nicole Shinski, a Lebanon, Ohio, mother of twin three-year-old boys and a one-year-old girl, says she wanted to enroll her sons in preschool last fall, but couldn't afford two years of preschool for both boys.
Parents say prices for food and clothing haven't risen much in recent years. But day-to-day expenses (paying the mortgage, filling the tank . . . ) eat up nearly everything they earn.
That's where the conversation gets strange. Rather than speaking of strategies to handle basic costs — how they're finding ways to plan ahead and save and invest — parents speak of the great contradiction: how much they're spending on things that are clearly unnecessary but that now feel all but mandatory. The optional has become the inescapable.
We're talking $70 for mommy-and-me Mandarin classes and $7,000 for summer camp, cell phones for fifth graders and iPods for eight-year-olds.
Not since the Depression have Americans saved nothing at all.
And always, always, parents speak of buying truckloads of consumer goods — kid-friendly groceries, kid-centric versions of family staples like bath products, even furniture — much of it emblazoned with Elmo, Thomas, SpongeBob, Spider-Man and the rest of their intensely marketed brethren.
Call it crazy, insane, ridiculous; parents do. But no one calls it rare. Anyone who isn't overspending knows plenty of people who are. Credit card debt grew nationally by $184 billion between 2000 and 2006, according to the research firm Demos. Meanwhile, the national savings rate for 2006 was negative one percent. Not since the Depression have Americans saved nothing at all.
Add mortgages, car loans and other debt, and it gets uglier. American personal debt is currently $15 trillion, says economist Ken Goldstein. There is $45 trillion in personal financial assets offsetting that debt, he says. But "the problem is that the people who have the assets aren't necessarily the people who have the debt." That's where our generation comes in.
What's oddest is that parents seem to know they're being unwise with their money, but they're doing it anyway. It's junior high redux: Everybody's doing it . . . because everybody's doing it. When it comes to parenting and purchasing, the definition of "necessity" has expanded to include just about everything.
©2008 Melissa Rayworth and Nerve Media
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Melissa Rayworth writes features stories each week for The Associated Press and other news outlets. Her work has appeared in magazines and newspapers across the globe, including The Washington Post and L.A. Times. She lives in Pittsburgh with her husband and two sons, but makes frequent trips to New York City for work and play. |
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