Teaching Tip: The Planet Money article, “What America Buys” is fascinating, and the side-by-side graph showing the spending differences between 1949 and 2012 are extremely interesting. If you can project these onto the board in class, it’s a great place to start off a class discussion. The Atlantic article “Prices Are People: A Short History of Working and Spending Money” also has excellent graphics dealing with the changes in types of employment since 1939 and how spending has changed since 1947.
Where does all our money go? That might seem like an easy question, but it turns out that the answer is: it depends. And what it depends upon is how much you earn. As you might expect, the more you earn, the more you spend on such things as education and entertainment.
As we learned in Chapter 2 of Personal Finance Turning Money Into Wealth when we discussed Expenditures: Where Your Money Goes, we discussed the importance of controling your expenditures. After all, as you know from Principle 2, which was introduced in Chapter 1, Nothing Happens Without a Plan – and understanding where your money goes is the first step in putting together a plan.
As we mentioned, what you spend your money on depends upon your income level – it also changes over time, and that change over time can be dramatic. A recent Planet Money article, “What America Buys” takes a look at not only what Americans spend their money on, but how those spending patterns have changed since 1949. Two of the biggest changes have come in the areas of food and housing, with a big decline in how much is spent on food, offset by a big increase in spending on housing.
- Take a look at the “What America Buys,” what surprised you the most about these changes in spending between 1949 and today? Be prepared to share your thoughts with your class.
- Take a look at the article “Prices Are People: A Short History of Working and Spending Money” in The Atlantic. The chart at the end of the article looks at How Spending Has Changed. Are you surprised by any of these changes? Which ones and why? Be prepared to discuss in class.