I have not yet received my rebate check from the US government for economic stimulus purposes. I have read though that people are planning on saving it, paying down debts or using it for necessities like food and gas. All very good things. I think the people who will loose out will be the ones that think it is good for another fancy handbag or 100th pair of red shoes. I think some Americans are coming to the conclusion that you are not what you own and that a simpler lifestyle has less financial risk in these uncertain times.
I have lived on both sides of the fence, a child of a uber-frugal dad and a spendy mom. I currently feel the urge to get a pair of dark jeans trouser pants even though I have plenty of pants. I feel the urge to pay extra principle on my mortgage every month even though I probably won’t be living there in 20 or 30 years. I feel the need to buy a car that gets 35 mpg or better AND has leather heated seats AND an automatic transmission AND costs less than $20K (used). Why do none exist? I guess I am a paradox that car makers don’t accommodate.
I am not suprised at the high cost of gasoline right now and fully expect it to get higher. (it’s not that they don’t want to increase oil production, it’s that they can’t because there isn’t more to be tapped) That said, it is scary that I spent $120.00 in May on Gas and I only drive on Weekends since I take the train and walk to work. If I was still driving every day to and from work that would be about double at $240.00. A full tank just cost me $65.oo and I have a 16 gallon tank.
What I didn’t see coming is the rising cost of food. Everything is not only going up in price at the grocery store, there is a difference in the regular prices of food depending on where you buy it in Chicagoland. I have started shopping at the super target in far west suburbia where Steve lives rather than pay about 10% more in Oak Park. And that doesn’t even include the difference in sales taxes by county.
I think people’s budgets will be pushed even further to the edge and breaking point in the rest of 2008 and that it will be a lean Christmas because the high cost of basic necessities will make it hard to afford non-necessity gifts. I would say that a good place for the rebate check would be an ING savings account and hopefully it will generate some interest before it becomes a Christmas gift fund.