THE VALUE OF MONEY
When does $10,000 equal $167,000? Oh, in about 70 years. HUH?
Recently, I read in a 1999 copy of a magazine, that $10,000 in 1933 would be the same as $167,000 ‘today‘. Recall that 1933 was 4 years into “The Great Depression”, and we are 2 years into what will be another capital “D” depression if we don’t soon get our act together.
The reason I bring that up is that I remember my mother’s delight one week when my father’s pay envelope held $10.00. That would add up to $520 for the year if it had been a weekly amount, but of course it was not. Dad supported a wife and two children, not handsomely, it didn’t allow for many extras, but Mom managed to feed and clothe us on it. Well, mostly…
What I’m really getting at though, is that while a chair fulfills its purpose until it falls apart, a dollar is only as good as its buying power, which can change its worth in a twinkling. What you put aside in savings today may be half the value, or twice the value when you go to get it. So far in my lifetime, it seems to always choose the ‘half‘.
Dad’s “contribution” to Social Security was five cents a week. That nickel could buy a loaf of bread or 5 first-class postage stamps back then.
Now some in D.C. are complaining that many people on SS, especially the older ones, have long since used up all the money contributed, and therefore are “actually on welfare” now. Maybe. I doubt it, though. They are forgetting the compound interest of all those years. But of course, there was no interest compounding in all those years, because Congress spent it as fast as it came in. And more importantly, they forget the difference in buying power of those nickels and dollars contributed. I don’t have any idea of how much my Dad or my Husband ‘contributed’. With all the years’ variables in pay and percentages, not to mention the rate of inflation, I doubt it could be learned. But I’ll bet it would come pretty close to breaking even and then some if promises had been kept to keep a separate fund and left to grow. Who knows? If the Congresses hadn’t put it in their toy box, we might have inherited a “Pot of Gold“.
Welfare indeed!!
