The coming economic depression will make us a better country.

[allthewiser]

Like all of you I am watching the economic news and it doesn't look like things are going to get better anytime soon. Facts be known I believe things are going to get a whole lot worse before they get better.

I very much doubt things will ever go back to the way they were in our lifetimes. Some of you may think things were better six months ago but I am not so sure they really were.

How many times have we heard complaints how people will never be able to live as well as their parents did? How many times have you heard someone pining how the 1950's mom could stay at home and the family could live on dad's single income from his job as a store clerk or factory hand?

So what really changed to make the mom stays home with the kids life impossible today? Did things really get more expensive?

Nothing got more expensive, the American consumer simply supersized everything.

How big is your house?

According to the National Association of Home Builders the average home size in the United States was 950 square feet in 1950. In 1970 the average size grew to 1,400 square feet and by 2004 the average size new home had increased to a whopping 2,330 square feet.

Think about it, In 54 years the average size of the American house increased by 245%. A 4 1/2% size increase every year for 54 straight years. No wonder so many are nearly broke!

No wonder so many Americans feel broke, they're paying for 2 1/2 houses where our parents paid for one. To many are paying for 2 1/2 times the associated property taxes, electric and heating bills.

We supersized everything and mom had to go off to work in order to pay the supersized bills.

We had a small three bedroom/single bathroom house of right at that 950 square feet for six of us. Dad fed and housed us from his salary as a factory worker while mom stayed home with the children.

On the street we lived on most mom's stayed home too but I remember very few having cars. We were a one car family and if mom needed the car, to do errands or perhaps run us to the dentist, she took dad to work and picked him up.

As far as mom taking us to a ball game well... forget about that because that is why God gave us legs and bicycles.

We very seldom went out to eat at a restaurant. This might have happened a couple times a year but it didn't happen often.

Christmas? Mostly clothes, underwear even, and maybe one or two toys when we were younger. As we grew it became clothes.

Mom was naturally frugal. We had powdered milk that she would mix half and half with real milk to stretch it. Mom had this eggs, tomato and cheese main dish she used to fix that was really pretty good but cheap. We would have hot dogs and hamburgers with steak happening once or twice a year. We didn't have soda around the house it simply did not exist for us.

Television was three channels; 3, 4, 9 and 13. I know that is four but 9 was educational and horrible. The very idea of paying for television reception was so foreign.

As a family we often played board games, monopoly and clue were two favorites, on Friday nights.

We had a phone but long distance was something foreign.

While this might sound to deprivation to some we really had it pretty good because we always knew we would eat, we never wondered where we would be sleeping and we always knew mom would always be right there beside us.

The good part of all this is I think we may be heading back to living like those times once again. Makes for better children and stronger adults.

[COUNTRYBUMPKIN]

You know what? Those were the day's! I would like it if we could return to the simplicity of those day's. Thank you for posting this:-)

[annymoll]

I see nothing wrong with two parents working to have a larger home, a larger savings, a larger retirement.(although sometimes I wonder why bother) I disagree with the lifestyle that involves charging to aquire trinkets. If you want trinkets, work and pay for them. In this society, even those on Welfare have cell phones, computers, and cable. I do not see that changing .It will be a rough ride for those that are not frugal, and have been charging out the ying yang.I think it will be rough for any that work.Even two jobs will not be enough for some.I remember my grandmother and the tough times she talked about during the depression. Her motto-"Love does not pay the electric bill, honey."It is not going to be pleasant for most.

[Russ]

I think the biggest change has been the credit that is available to people in the form off HELOC's and CC's. My dad would have had a heart attack if he had a $1K balance on his CC. I believe the average CC debt in the US is about $8K right now.
We have a 1450 sq ft house and 5 years ago the wife and I had many discussions on if we should get a bigger house... we could afford it, but decided we didn't want to clean a bigger house

[allthewiser]

You know what? Those were the day's! I would like it if we could return to the simplicity of those day's. Thank you for posting this:-)

Another thing I remember is mom and dad always paid the bills on time and they always saved money. True, they didn't have the credit cards, this was before Visa and MasterCard, but they still had monthly utilities and mortgage.

You will always spend less if you pay cash. Cash, not the visa debit card but get into the habit of spending greenbacks and you will spend less.

I think we are beginning to witness a sea change in American attitudes of what is and isn't important.

Among the many changes will be the American attitude towards debt. Far to many of us have bitten into the debt apple and we don't like that bitter after taste debt so often leaves.

Family and financial security is going to become important. We're going to stop buying things we can't afford with money we don't have to impress people we really don't like all that well.

Instead of being the status symbol having debt will return to being in the moron class it was in 1955.

Ever get the feeling our grandparents knew something we didn't?

It is really going to be tough. I'm in engineering for commercial and industrial construction and can assure everyone things are getting tighter by the moment. I've been doing this for many decades and I have never seen the kind of retreat, both in rate and breadth, I am seeing now. By Christmas the unemployment rate will be simply staggering. I see the numbers coming out of Dodge McGraw-Hill and in the last four weeks I have trouble believing what I am seeing.

True, there is unemployment for many but with the way people have taken on debt it simply isn't enough anymore. To many have allowed themselves to be in a position of missing a single paycheck, not even talking about six months, spells economic disaster for the entire family.

It is going to be awfully hard but in the long run we will be stronger for it.

[Grayce]

I have been worried about an economic downturn so we are really trying to pay off our LOC. We are living off one paycheque, my DH's paycheque goes entirely to debt repayment. A few years ago we locked in our mortgage for 10 years at a fixed rate because I am worried that interest rates will shoot up like they did in the 80's. A few years ago we thought about upsizing our house but decided against it because we didn't want to take on anymore debt. My husband works at a small business. We have planned that we can survive on just my paycheque if he gets laid off.

[SandNOceanGirl]

Once the economy truely hits "rock bottom" nothing will ever go back to the way it was. It will take several years for the economy to bounce back and hopefully most Americans will realize that spend...spend...spend is not the route to be taken. People have to have more personal accountablity for themselves and their money in the future.

I know I wish I would have paid more attention to my grandparents (since they are no longer here) and things they did. We will always be a work in progress!

[allthewiser]

I think the biggest change has been the credit that is available to people in the form off HELOC's and CC's. My dad would have had a heart attack if he had a $1K balance on his CC. I believe the average CC debt in the US is about $8K right now.
We have a 1450 sq ft house and 5 years ago the wife and I had many discussions on if we should get a bigger house... we could afford it, but decided we didn't want to clean a bigger house

Credit cards, other then maybe a J.C. Penny or Sears revolving credit card, wasn't available to the general public until the late 1960's and early 70's. Whenever we went shopping mom had the green stuff in her purse and she watched every dime like a hawk.

[katybug]

Credit cards, other then maybe a J.C. Penny or Sears revolving credit card, wasn't available to the general public until the late 1960's and early 70's.

Before everyone starts going on about how the older generations had so much more wisdom then us, remember, things simply were not AVAILABLE to them!

There were FAR stricter rules on loans (housing, credit cards, etc), you just couldn't get them then. Which I think leveled the playing field a bit, because you could only get what you had the money for, you couldn't put it on the C.C. back then.

Today all these wild and crazy loans/credit give people an inflated look of wealth.

Don't downplay your own knowledge and wisdom!

~KB

[allthewiser]

Before everyone starts going on about how the older generations had so much more wisdom then us, remember, things simply were not AVAILABLE to them!

So true and another good reason for something like frugal village.

Much of what has become available has been made to look as indispensable.

Internet is one of them. We pay $145 for bundled internet, telephone and basic cable. Is this something we absolutely can not do without? Then add the $80 a month cell phone bill and we're talking serious money of over $200 a month.

I could do without the cable, the telephone and maybe even the cell phones but I couldn't go without internet.

[Squirt]

I know that first post was in reference to growing up in the 50's, but it is uncannily similar to my life growing up in the 70's-80's. Right down to what we had for dinner.


I know it's going to be hard for nearly everyone, but I for one look forward to living a simpler life again.

[MRAHoffman]

I was talking to my aunt about the VERY same thing. Thank you, Thank you, Thank you.

[3tomboys]

I sure wish my grandparents were still around to talk to. I try to think about how they lived their lives and they always had enough and did not seem deprived. When I was born my dad was 45 years old. He passed away in April. The last time I talked to him we were discussing the economy and he suggested that my dh and I take some cash out of savings to have on hand. He lived through the Great Depression and he felt strongly that his family survived because his father did not trust banks. I remember when my grandmother passed away, my mom commented that they found dollar bills and five dollar bills behind pictures, in socks, etc. When everything was finished they had found several hundred dollars. My father said that my grandmother had done that for as long as he could remeber. She would do it with every peeny she was able to, and on several occasions that change helped them keep there home and food on the table. We can learn a lot from past generations, it is to bad that we didn't always pay attention.

[Marie78]

I think those of us here at FV will have an advantage, because we started doing what we could to live with less and within our means before the banks starting tanking recently. I grew up in the early 80's and we lived the simple life. I loved it, we had one family car, a 2 bedroom 1 bath 850 square foot home for our family of four. We had food on the table, no debt, and meals out were a treat. Our mom was home with us everyday and she took care of us. I didn't want for anything because we were a close family that had a lot of fun...family game night anyone? We rode our bikes and played outside a lot, we did not have a weight problem (a result of healthy home cooked meals and enough exercise outside). We did not have video games or cable. We read for fun (imagine that!).

We are paying off the rest of our debt and will be debt free going into January 2009 (5 months earlier than we had hoped). We live in a 2 bedroom 1 bath 900 Sq ft. apartment with heat included in our rent. I would be fine without cable, but Dh would freak at this point, so we'll keep it (at least until baby #1 is born in July 2009). We currently have 2 cars and both are paid for in full. My life now is very reminiscent of my life growing up in that 850 sq foot home with my mom, dad, and sister. Friends and family keep asking us if we are buying a home before the baby arrives. The answer of course, is "NO!" we are starting to live on one income and save the other income so we can have a hearty EF by the time baby comes (not a hefty mortgage).

The plan is I will work part time around Dh's schedule so that we won't need daycare at all and one of us will always be home with our children to nurture them. I guess the picture looks a little different from my life in the early 80's because this time mom and dad will both be equal care givers and bread winners and both mom and dad will be in the kitchen whipping up homemade meals for the family. The fundamentals are all the same though: children will be raised at home and life will be lived simply but with lots of love and nurturing as opposed to just lots of "things".

[MomToTwoBoys]

That's the picture of how life was for me growing up in the late 70s/80s. My mom worked two jobs in the 90s even when the economy was great, but it wasn't enough sometimes.

It's taught me to be more respectful of the money I have, the things I own, and where I could be if I was more frivolous with all of it.

We own a 1200 sq/ft house because it was what we could afford within our means at that time. We were bringing in $40k/yr before tax credits and with the house being worth $131,500 at the time, we bought when the time was right and didn't want to go beyond anything we could afford. Then the housing bubble happened and prices shot through the roof. We could have sold it for $395k but we didn't. Now that the housing bubble broke, I'm glad we didn't sell when we did.

We don't spend as much as we did before, but we still treat ourselves to things that keep us from spending more later on down the road on stuff that doesn't make us happy. If we could eat hot dogs and mac n cheese all the time, we would to save money but that's not healthy. I ate mac n tomatoes, tuna casserole, etc when I was younger and while it was good, I didn't want to live like that forever.

I'm just thankful for being here at FV where people can help me keep grounded in these times.