Monday, July 19, 2010

Living Phrugal in Philadelphia

I am still amazed that in 2010 after being in an economic downturn for 10 quarters straight (3-month periods) , we are still calling this economic period we are facing, a recession. The standard newspaper definition of a recession is a decline in the Gross Domestic Product (GDP) for 2 consecutive quarters. ( As I look all over the internet, we are now trying to redefine the terminology for a depression. A depression, from my textbooks in 1995, is a prolonged period (lets say 3 quarters) of a recession. WE ARE IN AN ECONOMIC DEPRESSION. Median household income declined in 2008 and 2009. A number of factors contribute but the most important factor is that housing costs rose during the 1990's into 2000's that outpaced rises in income. What made it even worse is that women still earn 77% of a man's dollar especially in a country where over 33% of all children live in single mother households. ( To put it bluntly, women are bringing home less dollars and have to stretch those dollars for provide shelter, feed and clothe a family. Philadelphia has a very interesting problem, it is not the cost of buying a house that keeps family's out (right now it is credit). Historically, it is the combined rates of PGW and PECO that keep the American dream elusive in Philadelphia.

I will take a very small example, SEPTA, and show the how changes in income affect the middle class. SEPTA recently instituted a small fare increase (during a economic depression). This weekend, my son had to attend an event at Temple University and I decided to make it a family outing using SEPTA. As we got to the EL, I found out that now children over the age of 4 are faring paying adults. Before the hike increase, I would pay $1.00 for my oldest child. Now our 3.00 trip went to $8.00 (166% increase). As I have running around to do, we again travelled using SEPTA to the next destination (another $6.00 - since my son was not present), then travel back to get my son (finally, I was at a station to purchase tokens) so another $4.65. Then our last trip of the day to our home cost another $8.00. In total, it cost $26.65 to take my family to Temple University and back! A small example like this shows why it does not pay to be apart of the middle class. Even my usual first choice, PhillyCarShare, would have cost $48.00 (rates are at a premium on the weekends). Though SEPTA was the cheaper option, it is no longer an affordable option. Before the rate increase, I would have paid $12.00 for this trip, now I have just shelled out $26.65 (rate increase of 110%). One of the qualities that makes me special is the ability to overcome obstacles. In an economic depression, lack of capital is the obstacle.
Here are three workarounds overcome this obstacle:
1) Trader Joe's instead of the your neighborhood supermarket. I discovered Trader Joe's a few years ago we we decided to give up beef, chicken and pork (still eating fish). Trader Joe’s serves eating options as health conscious choices that also satisfy your wallet! The meats are a bit pricey but Philadelphian’s have the famous Reading Terminal Market as an alternative. On average I save 50 -90 dollars on our twice a month shopping trips.
2) PhillyCarShare ( for short trips or a family of three or more. Price includes gas, insurance and only 25 cents a mile! Another perk for business - business accounts include fee membership as compared to Zipcar’s 75.00 membership fee option.
3) SEPTA Regional Rail - Did you know commuting around the city during off peak hours is Free for transpass holders? Take your subsidy back (city transit riders subsidize suburban regional rail riders WOW!) and fill up the comfortable Regional Rail trains.

This morning my oldest child, Sahar, told me that her brother was taking a bubble bath. I thought to myself “that is strange since we have no bubble makers”. To my surprise, Nasir, my 5 year-old had used mommy’s shampoo to make a bubble bath. Apparently, the ability to overcome obstacles has reached my next generation!

How are you overcoming obstacles today?

1 comment:

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