100 years can bring about a lot of change.  Let’s look a a couple of these changes:

• In 1901, the average family size was 4.9 people, by 2002-03 it was down to 2.5.
• In 1901 women made up one quarter of the New York City labor force, by 2000 it was over 50 percent.
• In 1901, the average U.S. family earned $750, by 2002-03 it was up to $50,302.
• But, from what you learned in Chapter 3 of Personal Finance, Turning Money Into Wealth, the Time Value of Money chapter, you can’t compare money in two different time periods.  So let’s adjust for inflation.  As we mentioned, the average family income in 1901 was $750, and in 2002-03, the average family income expressed in 1901 dollars was $2,282, or about three times as much.

How we spend our money is something we spend a lot of time on in Personal Finance, Turning Money into Wealth.  In fact, not only do we look at what people spend their money on in Chapter 2, but we also look at how they spend their money in a section called “Smart Buying” in Chapter 8.  In fact, “Principle 6: Waste Not, Want Not – Smart Spending Matters” looks directly at making sure you don’t waste your money.  This is certainly an important topic to most of us!

There are a lot of different ways we can look at all the change that has taken place in the last 100 years.  Set your focus on how many of these changes reflect changes in the typical American’s personal finance – how much Americans spend, and what Americans spend their money on.  What was a luxury 100 years ago, may be viewed as a necessity today – think running water, indoor toilets and a car! The Atlantic recently looked at changes in spending, using the information from the Bureau of Labor Statistics, “100 Years of U.S. Consumer Spending: Data for the Nation, New York City, and Boston” to draw data from.  The Atlantic article, “How America Spends Money: 100 Years in the Life of the Family Budget” does a great job at changes that have taken place over the past 100 years – it’s fun to look at and think about – wonder what changes will take place in the next 100 years?

Discussion Questions:

1. Take a look at the article “How America Spends Money: 100 Years in the Life of the Family Budget” does a great job of presenting the changes in an easy to understand manner.  What changes surprised you the most?  Why do you think this change (the one that surprised you) took place?  Either write a short paper on this or be prepared to discuss it in class.
2. Think of stories from grandparents, parents, even your own childhood.  How have things changed with each generation?  What changes seem significant just in your lifetime?  Can you make any predictions about changes that will have an impact on how you will be spending your money?