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But incomes didnt keep pace with the housing market.
In other words, the house sales price-to-income ratio in 1984 was 3.49.
By 2022, this ratio jumped to 5.81.
Living in an Affordable Apartment
If you cant afford to buy, you rent.
In 2023, the rent-to-income ratio climbed to its highest in decades and hit 40%.
In contrast, renters only needed to use around 24% of their income for rent in 1985.
This wasnt the case for baby boomers.
In the 80s, savings account rates climbed as high as 8%.
The high rates werent sustainable and led toseveral bank failuresin that decade.
In 1970, out-of-pocket spending per person was equivalent to $956 in todays inflation-adjusted dollars.
In 1980, that figure grew to $970 in todays dollars.
A decade later in 1978, average tuition had even dropped slightly to $4,416.
But by 2024, average tuition has quadrupled to $17,709 per year.
In 2020, that same student would need to work 28 hours per week to afford the same thing.
By 2022, the number of states that offered public programs dropped to 10.
Want to guess what the CPI is now?
In July 2024, the CPI hit 314.5.
It just goes to show how much purchasing power has eroded over time.
