Mustachian habits have shielded me from the recent inflation spike.

[Zikoris]

I've seen a ton of people talking about how their costs are skyrocketing due to higher inflation, especially in certain specific areas. I realized that in my own situation, I'm almost entirely shielded from that, for a few very specific reasons, and even benefit in some ways:

1. My housing costs continue to be low as I moved into a very basic and cheap apartment many years ago and just never upgraded to something bigger/pricier the way normal people do.

2. I've never had a car or rented a car or driven anything, which has protected me against increasing costs in that category - gas, purchase, repair labor costs, etc.

3. Diet is a REALLY big one. I don't buy animal products at all, or any of the other things that have increased a lot, like restaurant food, premade stuff, etc. The staples I buy in large volumes are basically the same price they've been for a long time.

4. I don't really buy any of the consumer goods that have gone up in price, and what I do buy I get secondhand. Thrift store pants have not increased in price as far as I can tell.

5. I'm not 100% sure on this, but I think at my company raises were higher this year in part due to perceived cost-of-living increases. As my costs dropped substantially at the start of the pandemic (due to not travelling) and have remained low, this had had a double-whammy impact on my finances, since I'm making more money with lower spending. My net worth increases have been phenomenal.

[HPstache]

Do you own the apartment?  If you rent, have the property owners not raised rent on you after all of these years?  If they haven't been raising it on you, maybe that's a testament to the savings for being a great tenant.. or maybe just luck haha!

[Abe]

We’re in the same boat for spending habits (but not housing). I haven’t really noticed anything change in price, but other than food don’t shop much. I think fruits and vegetables are basically the same, and milk a bit more expensive. We don’t eat much meat so unsure, but then found this table, which shows meat prices are up considerably!

Most of the increase seems to be in meat, elective expenses (vacation, maids, car purchases) and fossil fuels. Everything else has seen <4% increase.

https://www.bls.gov/news.release/cpi.t02.htm

[Zikoris]

Do you own the apartment?  If you rent, have the property owners not raised rent on you after all of these years?  If they haven't been raising it on you, maybe that's a testament to the savings for being a great tenant.. or maybe just luck haha!

We rent in a co-operative. The prices have gradually increased, but much less than other places in the city. I believe we were paying $720 in 2010 when we first moved in, and now we pay $847. Moving here was a strategic plan eleven years ago, when we wanted to secure something cheap to last until we left Vancouver. We are also excellent tenants though.

[Cassie]

My housing costs are stable since I own my condo. Being retired a tank of gas usually lasts a month. I do eat out and prices have increased. My doggie insurance went up 20/month so I chose a higher deductible and lower payout. It’s really catastrophic insurance because vets are so expensive here. I lowered my cell phone bill by switching from att at 54/month to T-Mobile prepaid for 15/month. My groceries went up but I am only one person so I have control of what I buy.

[A mom]

We’re in the same boat for spending habits (but not housing). I haven’t really noticed anything change in price, but other than food don’t shop much. I think fruits and vegetables are basically the same, and milk a bit more expensive. We don’t eat much meat so unsure, but then found this table, which shows meat prices are up considerably!

Most of the increase seems to be in meat, elective expenses (vacation, maids, car purchases) and fossil fuels. Everything else has seen <4% increase.

https://www.bls.gov/news.release/cpi.t02.htm

So we should avoid meat and travel. Good for our pocketbooks, good for the planet. :)

[Dicey]

As someone old enough to have lived through several inflationary periods, I am not afraid of it. Mustachians are pros at adapting to changing situations. Think of it as an opportunity to give your frugality skills a workout to keep them strong and supple.

[Metalcat]

Do you own the apartment?  If you rent, have the property owners not raised rent on you after all of these years?  If they haven't been raising it on you, maybe that's a testament to the savings for being a great tenant.. or maybe just luck haha!

Everywhere I have lived in Canada has had rent control. Landlords can't just arbitrarily raise rents, they can only raise a set "inflation" amount per year.

AFM, I'm being affected by inflation because my condo building is 50 years old and needs a huge amount of work, so we're being hit big time by inflation. That said, because it's a large, high-rise condo, major foundational work, total balcony rebuild, and a new roof is costing me $7500 over 4 years, or an extra $150/mo. So no big deal.

We own a car, but barely drive.
We also cook vegetarian, and haven't been terribly affected in terms of food costs.

Because we share 5 of our 6 walls, and have SW facing floor to ceiling windows, our heating is extremely cheap.

Like @Zikoris we're just not really feeling the pinch of inflation, and what we have felt, we've adapted to. Milk started getting stupid expensive, so I switched to cheap green tea instead of coffee and milk. And I bought a bread maker because rye bread was getting ridiculous.

[Roland of Gilead]

Well obviously a low consumption lifestyle will shield you from a lot of inflation problems :-)

Eventually some of it is going to leak through into unavoidable things, like medical costs.  It is only fair that hospitals, staff, drugs get to raise their prices to match the increases in inflation on goods in other sectors.

[American GenX]

I'm definitely on the frugal side.  I can't remember the last time I bought steak or had an expensive meal out.  But despite my frugalness, I estimate my overall expenses are up 15%.  So, that's what I consider the true inflation rate, not the low government figures which are manipulated to keep them lower than true inflation.

I don't drive much, but I have to eat and pay my regular bills.  My homeowner's insurance jumped 12%.  Many food items have gone up, some as much as 40% based on the regular price, plus the sales aren't as good, so my out of pocket has increased 60% on some of these!

I had already cut way back on dining out years ago and have extremely low discretionary spending, but I expect to ramp those up when I FIRE, so I'll feel the pain there also.   And, I have a lot of planned home maintenance and improvement planned on my house that I plan to do when I FIRE, and the cost has gone up significantly on materials.   So, that 15% figure may jump up quite a bit higher after I FIRE.   My stash is being eroded by inflation.  And eventually, there's going to be a big correction, and it's going to be even more painful with such high inflation.

But, I remain an optimist.

[American GenX]

Well obviously a low consumption lifestyle will shield you from a lot of inflation problems :-)

Eventually some of it is going to leak through into unavoidable things, like medical costs.  It is only fair that hospitals, staff, drugs get to raise their prices to match the increases in inflation on goods in other sectors.

Low consumption lifestyle hasn't been shielding me.  I'm definitely seeing it.  As far as leaking through to things like medical costs, it already is.  Medical costs have already been increasing considerably faster than the understated government inflation figures for years while insurance coverage has actually gotten worse over time, so it's a double whammy.  Those costs will continue to increase.  And with the financial state of Medicare, it could be an even more grim future regarding health care expenses.

[Metalcat]

Well obviously a low consumption lifestyle will shield you from a lot of inflation problems :-)

Eventually some of it is going to leak through into unavoidable things, like medical costs.  It is only fair that hospitals, staff, drugs get to raise their prices to match the increases in inflation on goods in other sectors.

OP is in Canada

[Roland of Gilead]

OP is in Canada
[/quote]

just because it seems like your medical care is free, doesn't mean it really is.   If the costs increase for your government, you can bet they will increase in some other area for you.

[Metalcat]

OP is in Canada

just because it seems like your medical care is free, doesn't mean it really is.   If the costs increase for your government, you can bet they will increase in some other area for you.
[/quote]

Yes, my point was just that OP won't directly see a rise in healthcare costs. I understand how math works.

Plus with our healthcare being mostly not for profit, there's a lot less padding of the inflation down to the consumer like in other for profit industries.

For example, despite dentistry being private industry here, the fee guides aren't set by the insurance companies, they're set by the provincial dental associations, and those haven't risen with inflation in over a decade. So instead of patients paying more for dental care, dentists have just made less money.

When the state has a ton of control over an industry, they can maneuver a lot more where that inflation gets distributed.

Of course it still has to go somewhere. But it's definitely a different process.

[Roland of Gilead]

For example, despite dentistry being private industry here, the fee guides aren't set by the insurance companies, they're set by the provincial dental associations, and those haven't risen with inflation in over a decade. So instead of patients paying more for dental care, dentists have just made less money.

Makes a lot of sense but in the longer long term that can't continue right?  At some point people will will just decide to become software engineers instead of dentists?

[Cassie]

I have lived through other worse inflationary times. When I was condo shopping I didn’t consider any small complexes because you need enough people to share the costs. 

[American GenX]

I have lived through other worse inflationary times. When I was condo shopping I didn’t consider any small complexes because you need enough people to share the costs.

With housing prices going up so much in most areas, I'm lowering my expectations of relocating when I FIRE, as I had been planning as a high possibility for years.  Sadly, I live in a more depressed market am not seeing anywhere near those same gains on my own home, so these increases really work against me, and it piles on with higher commissions, homeowner's insurance, and property tax as well, not to mention the higher cost of materials for repairs and improvements.

I forgot to mention that I'm factoring in an estimated 30% increase in my heating bill this winter based on some cost estimates I've seen, but it may actually end up being even higher.  The cost of natural gas is up more than 100% from a year ago.

[Metalcat]

For example, despite dentistry being private industry here, the fee guides aren't set by the insurance companies, they're set by the provincial dental associations, and those haven't risen with inflation in over a decade. So instead of patients paying more for dental care, dentists have just made less money.

Makes a lot of sense but in the longer long term that can't continue right?  At some point people will will just decide to become software engineers instead of dentists?

Not when the government also changes the licensing mandates and makes it easier for foreign trained dentists to practice, and they're willing to work for a lot less, because for many of them, it's still A LOT more.

See? When you can control the entire economy, you have a lot of control over *how* the inflation gets moved around as opposed to directly passing it to consumers.

[Stasher]

I as well haven't really seen the effects of inflation and in 2021 my average monthly costs are down compared to 2020 according to my excel spreadsheet tracking. The single biggest thing you can do is build a diet and lifestyle around things that are not extremely affected by supply chain and climate change inputs as well as carbon intensive industry.

Perfect examples are dairy, poultry and meat as they require massive energy input and shipping throughout each stage of the end product. Each stage is affected by rising costs and inflation which is then all added up in the consumers pocket book. I am happy we changed to a plant based diet primarily and gave up drinking dairy. Not buying meat saves sooooo much money, not drinking milk is cheaper and also eating local seasonal fruits/veggies is key.

The only cost that I have seen going up is big is insurance of homes and autos. This seems to be multiple factors though, such as climate change, ongoing major disasters, changes to laws and of course insurance companies chasing profits. So not sure I can peg this on on inflation.

I tend to walk and bike everywhere for the most part thus we don't spend much on fuel at all. This would have impacted us the most. Again, oil industry and then fuel distribution/sales is a messed up hierarchy of opec influence, climate change, carbon pricing, govt policy, supply chain issues and just pure profit driven activities.

Eating out which is our biggest lifestyle extravagance and how we do our part to support local small business has seen an increase. Yes they are affected by the big food industry costs mentioned above and this has to be accounted for. That being said I think for our area though is we are just seeing rising costs because staff are being recognize as so valuable and minimum wage is increased well ($15.20 in BC) but businesses are paying much more now.

What is happening to housing costs in respect to purchasing real estate is what is skewing the inflation numbers the most. In most of Canada we are seeing rising real estate as pushing inflation numbers through the roof. Where I live has seen a 25-30% year over year single home average sale price increase.

After all that is said, MMM lifestyle has shielded my family as well from the "reported" spikes. No debt, secure housing and minimal expenses is a trifecta of privilege for my quality of life.

[nalor511]

Congrats on your life choices!

[Radagast]

I don't think I really buy it though. Low spending and low inflation are not the same thing. Spending level is an absolute value and inflation is a relative value. Inflation is just a percent increase, and if your expenses are already low or you reduce your spending in response, then you were not shielded from inflation. I could understand, though, if inflation has been largely limited to products you don't buy, such as meat. It could also be that some inflation is temporarily deferred.

Based on my observations on the rising costs of maintaining housing (and all infrastructure), nobody is escaping this, rent or own. Maybe there is some deferred maintenance, which may or may not be an advantage. Or maybe some luck in not needing maintenance.

Public transportation I expect will be even more sensitive to inflation. Locally, anyway, the bus drivers keep demanding and getting higher pay. Parts and gas are rising at the same pace as anything. Even if your only transportation is a pair of shoes, it will go up in price or down in quality the next time you buy it. So definitely not shielded in this area.

I've noticed staples here are up 10-20%, but maybe that was just the ones I noticed because they obviously changed. Ultimately, people who make or import beans will demand a raise too.

I admit I never understood high housing costs in Canada. Canada leads the world in terms of land per capita and lumber per capita, and is not far off on minerals production. Surely houses should be cheap there if anywhere.

[Roland of Gilead]

Not when the government also changes the licensing mandates and makes it easier for foreign trained dentists to practice, and they're willing to work for a lot less, because for many of them, it's still A LOT more.

See? When you can control the entire economy, you have a lot of control over *how* the inflation gets moved around as opposed to directly passing it to consumers.

Yes, I see that.  We did that in the USA back when we were building railroads.  We imported a lot of Chinese who were willing to work much cheaper than the local population. 

Go Canada!

[Metalcat]

Not when the government also changes the licensing mandates and makes it easier for foreign trained dentists to practice, and they're willing to work for a lot less, because for many of them, it's still A LOT more.

See? When you can control the entire economy, you have a lot of control over *how* the inflation gets moved around as opposed to directly passing it to consumers.

Yes, I see that.  We did that in the USA back when we were building railroads.  We imported a lot of Chinese who were willing to work much cheaper than the local population. 

Go Canada!

Lol, funny that you assume that it's turned out well. It's slowly decimating the dental industry and in no way helped serve the underserved communities that they were trying to serve. I used the example just to show how even though inflation needs to go somewhere, when it's in the hands of legislators, they can direct where it goes to a much larger degree than a private corporation that can really only just pass it down their own line.

Also, are you implying that importing Chinese to build the railroads was a good policy? Because we did that here in Canada and every Canadian Gen X and Millenial remembers the Canadian Heritage commercials where they talked about how many Chinese people brutally died, and we ALL know the famous line, spoken in a thick accent "They say there is one dead Chinese man for every mile of that track. That's what they say."

I bet every Canadian reading can hear and picture the line I just quoted. Our version of NPR calls that period of abuse of Chinese workers "A Legacy of Hate."

[Villanelle]

I needed a car this spring and bought used, but probably still paid slightly more than I would have a year prior.  Thankfully, I bought juuuust before prices really seemed to skyrocket.  Same with rent.  We moved in April and prices had certainly started going up, but would have been even higher even a couple months later when the RE market really kicked into hyperdrive. 

I drive probably 15 miles a week most weeks, so gas prices don't affect me much.  But I still buy food, occasionally eat out, and looking at buying a new sofa, etc.

It always puzzles me when people assume that mustachians are somehow automatically shielded, at least partially, from inflation.  (Not when people assume that mustachians can likely flex their spending creatively to move away from spending in areas of higher inflation, at least partially.  That makes perfect sense.)  Unless you aren't spending anything, it doesn't seem to me like there is any security from inflation.  It's just as likely that rice and beans will inflate as gas.  Just as likely that rent will increase as beef.  Gardening services vs. lawnmower parts.  Heating costs vs wool socks.  airplane tickets vs. camping tents.  Whatever. 

 We all spend money, and i'm not sure why there is any reason to assume that the categories in which we do spend will be the ones that experience lower inflation. What we can do is flex our spending smartly.  I'm waiting for a good sale before buying the sofa I want, and also scoping pieces on Marketplace and a couple of auction sites.  If beef goes crazy, I'm smart enough to just increase our chicken intake (and decrease our meat intake) if that's lower.  Being flexible and in tune with costs can shield us, somewhat from inflation.  But if prices overall are up 7%, there's no reason to think that the stuff we usually spend on is only going to be up 4%, simply because we spend less. 

[Zikoris]

I don't think I really buy it though. Low spending and low inflation are not the same thing. Spending level is an absolute value and inflation is a relative value. Inflation is just a percent increase, and if your expenses are already low or you reduce your spending in response, then you were not shielded from inflation. I could understand, though, if inflation has been largely limited to products you don't buy, such as meat. It could also be that some inflation is temporarily deferred.

Based on my observations on the rising costs of maintaining housing (and all infrastructure), nobody is escaping this, rent or own. Maybe there is some deferred maintenance, which may or may not be an advantage. Or maybe some luck in not needing maintenance.

Public transportation I expect will be even more sensitive to inflation. Locally, anyway, the bus drivers keep demanding and getting higher pay. Parts and gas are rising at the same pace as anything. Even if your only transportation is a pair of shoes, it will go up in price or down in quality the next time you buy it. So definitely not shielded in this area.

I've noticed staples here are up 10-20%, but maybe that was just the ones I noticed because they obviously changed. Ultimately, people who make or import beans will demand a raise too.

I admit I never understood high housing costs in Canada. Canada leads the world in terms of land per capita and lumber per capita, and is not far off on minerals production. Surely houses should be cheap there if anywhere.

Inflation has definitely been mostly limited to things I don't buy (meat, gas, restaurant food, etc). As far as housing goes, I don't know what to tell you, I've been paying $847 since October 2019. As far as shoes go, it's really hard to say since obviously you can't generally buy the exact same pair several years later to compare price, but my current pair is almost two years old and going strong, and cost roughly the same as the pair I bought two or three years before that.

[American GenX]

stimated 30% increase in my heating bill this winter based on some cost estimates I've seen, but it may actually end up being even higher.  The cost of natural gas is up more than 100% from a year ago.

Oh no, I was mentally preparing myself for the 30% increase in natural gas heating bills this winter, and just a while ago, I heard they are expecting them to be 50% higher in this part of the country.   :(

[Morning Glory]

stimated 30% increase in my heating bill this winter based on some cost estimates I've seen, but it may actually end up being even higher.  The cost of natural gas is up more than 100% from a year ago.

Oh no, I was mentally preparing myself for the 30% increase in natural gas heating bills this winter, and just a while ago, I heard they are expecting them to be 50% higher in this part of the country.   :(

I haven't heard of a rate increase here. I also haven't put my heat on yet.  It's been unseasonably warm and I had the windows open the last 2 days.

I have a bunch of delayed spending coming up, so hopefully I didn't time that badly.  (Moving across country and replacing mattresses etc).

[American GenX]

I don't think I really buy it though. Low spending and low inflation are not the same thing. Spending level is an absolute value and inflation is a relative value. Inflation is just a percent increase, and if your expenses are already low or you reduce your spending in response, then you were not shielded from inflation.

Bingo.  Just because I cut back elsewhere in my budget doesn't mean I shielded myself from inflation.  And I'm already living with a pretty lean budget with minimal discretionary, so I'm just having to take it on the chin.  And if something hasn't gone up in price yet, I certainly won't be surprised when it soon does.

[American GenX]

stimated 30% increase in my heating bill this winter based on some cost estimates I've seen, but it may actually end up being even higher.  The cost of natural gas is up more than 100% from a year ago.

Oh no, I was mentally preparing myself for the 30% increase in natural gas heating bills this winter, and just a while ago, I heard they are expecting them to be 50% higher in this part of the country.   :(

I haven't heard of a rate increase here. I also haven't put my heat on yet.  It's been unseasonably warm and I had the windows open the last 2 days.

I certainly hope it's not up as much as they are saying.  This isn't actually my source, but it matches up with what I heard earlier.

https://abcnews.go.com/Business/wireStory/heating-bills-set-soar-inflation-hits-energy-prices-80559507

Nearly half the homes in the U.S. use natural gas for heat, and they could pay an average $746 this winter, 30% more than a year ago. Those in the Midwest could get particularly pinched, with bills up an estimated 49%

[Morning Glory]

I don't think I really buy it though. Low spending and low inflation are not the same thing. Spending level is an absolute value and inflation is a relative value. Inflation is just a percent increase, and if your expenses are already low or you reduce your spending in response, then you were not shielded from inflation.

Bingo.  Just because I cut back elsewhere in my budget doesn't mean I shielded myself from inflation.  And I'm already living with a pretty lean budget with minimal discretionary, so I'm just having to take it on the chin.  And if something hasn't gone up in price yet, I certainly won't be surprised with it soon does.

But your stocks are going up more because of inflation (if dollars are worth less then stock prices go up) so for someone living off a stock portfolio it should be fairly neutral.

[American GenX]

I don't think I really buy it though. Low spending and low inflation are not the same thing. Spending level is an absolute value and inflation is a relative value. Inflation is just a percent increase, and if your expenses are already low or you reduce your spending in response, then you were not shielded from inflation.

Bingo.  Just because I cut back elsewhere in my budget doesn't mean I shielded myself from inflation.  And I'm already living with a pretty lean budget with minimal discretionary, so I'm just having to take it on the chin.  And if something hasn't gone up in price yet, I certainly won't be surprised with it soon does.

But your stocks are going up more because of inflation (if dollars are worth less then stock prices go up) so for someone living off a stock portfolio it should be fairly neutral.

I'm not FIREd yet, so I'm still living off my paychecks, which will likely be only 2% to 3% higher next March.  If stocks continue to go up for ever, that will help me afford inflated prices after I FIRE, even with my conservatively invested portfolio, but the big correction will hit at some point.  Fortunately, I do have a big buffer for discretionary spending that I can cut back on if I have to - hate to be forced to do that.

[Roland of Gilead]

Also, are you implying that importing Chinese to build the railroads was a good policy? Because we did that here in Canada and every Canadian Gen X and Millenial remembers the Canadian Heritage commercials where they talked about how many Chinese people brutally died, and we ALL know the famous line, spoken in a thick accent "They say there is one dead Chinese man for every mile of that track. That's what they say."

I bet every Canadian reading can hear and picture the line I just quoted. Our version of NPR calls that period of abuse of Chinese workers "A Legacy of Hate."

No, I was being sarcastic.  I thought you were saying it was a good thing Canada is doing, importing cheap labor and paying them lower wages than the locals would ask for (dentists)

[Metalcat]

Also, are you implying that importing Chinese to build the railroads was a good policy? Because we did that here in Canada and every Canadian Gen X and Millenial remembers the Canadian Heritage commercials where they talked about how many Chinese people brutally died, and we ALL know the famous line, spoken in a thick accent "They say there is one dead Chinese man for every mile of that track. That's what they say."

I bet every Canadian reading can hear and picture the line I just quoted. Our version of NPR calls that period of abuse of Chinese workers "A Legacy of Hate."

No, I was being sarcastic.  I thought you were saying it was a good thing Canada is doing, importing cheap labor and paying them lower wages than the locals would ask for (dentists)

Lol! That makes more sense.

Although, importing Chinese railway workers is very different from reducing the barriers for foreign medical professionals to come to the country. It's not like they were rounded up and forced to work for less, they just no longer have to retrain for multiple years to work here. Still, it hasn't worked out as anyone planned.

[Abe]

I don't think I really buy it though. Low spending and low inflation are not the same thing. Spending level is an absolute value and inflation is a relative value. Inflation is just a percent increase, and if your expenses are already low or you reduce your spending in response, then you were not shielded from inflation.

Bingo.  Just because I cut back elsewhere in my budget doesn't mean I shielded myself from inflation.  And I'm already living with a pretty lean budget with minimal discretionary, so I'm just having to take it on the chin.  And if something hasn't gone up in price yet, I certainly won't be surprised when it soon does.

Inflation is highly variable across categories. If your biggest expenses are hedged against inflation (either through fixed mortgage / loans or paid off) then one can be shielded to a large extent.

Example:
27% of our budget is taxes
16% is mortgage
45% is saved
12% is subject to inflation

Since our exposure to inflation is much lower than most, we are relatively shielded. Obviously anyone who’s not a self-sufficient survivalist is subject to some inflation.

[Metalcat]

I don't think I really buy it though. Low spending and low inflation are not the same thing. Spending level is an absolute value and inflation is a relative value. Inflation is just a percent increase, and if your expenses are already low or you reduce your spending in response, then you were not shielded from inflation.

Bingo.  Just because I cut back elsewhere in my budget doesn't mean I shielded myself from inflation.  And I'm already living with a pretty lean budget with minimal discretionary, so I'm just having to take it on the chin.  And if something hasn't gone up in price yet, I certainly won't be surprised when it soon does.

Inflation is highly variable across categories. If your biggest expenses are hedged against inflation (either through fixed mortgage / loans or paid off) then one can be shielded to a large extent.

Example:
27% of our budget is taxes
16% is mortgage
45% is saved
12% is subject to inflation

Since our exposure to inflation is much lower than most, we are relatively shielded. Obviously anyone who’s not a self-sufficient survivalist is subject to some inflation.

Exactly. I think a lot of @Zikoris point was that a lot of her spending is less affected by inflation than others, because as you said, inflation isn't spread evenly.

So for example, our groceries went up with the exploding cost of dairy, we already don't buy meat. So we reduced dairy and substituted with foods that weren't as inflated. Likewise, I often choose between cheap clothes at Costco or from the used clothing store. The Costco clothes are rising, but the thrift shop isn't. So I don't have to cut back on clothes buying, I just shift to a less inflated source.

If you avoid a lot of the big baddies of inflation or pivot away from them when needed, then you get shielded from its worst affects by taking advantage of the uneven distribution of inflation within the market.

[Kazyan]

My expenses have gone up a bit, but the way the internet has been talking about inflation, I would have thought it was a hair-on-fire event instead of just, like, $20 extra bucks a month? I haven't done the math, but I'm not feeling a boot on my back or anything.

[Morning Glory]

My expenses have gone up a bit, but the way the internet has been talking about inflation, I would have thought it was a hair-on-fire event instead of just, like, $20 extra bucks a month? I haven't done the math, but I'm not feeling a boot on my back or anything.

It does seem like there are a lot of news articles about it lately. I think it might have more to do with other news being slow: no US election, stock market steadily going up, everyone's tired of hearing about covid, etc. 

[Radagast]

Inflation has definitely been mostly limited to things I don't buy (meat, gas, restaurant food, etc). As far as housing goes, I don't know what to tell you, I've been paying $847 since October 2019. As far as shoes go, it's really hard to say since obviously you can't generally buy the exact same pair several years later to compare price, but my current pair is almost two years old and going strong, and cost roughly the same as the pair I bought two or three years before that.

I guess it comes down to what inflation is. If you say "money is 9% less valuable across the board, except to me, yay!" then my first reaction is "yeah right." If you say "half the products are 18% more expensive, and I don't buy those!" my first reaction is to think it is a lucky coincidence. In general my first reaction to claims that Mustachians are less susceptible to inflation is disbelief based on the two lines of reasoning above. If inflation is high and the thrift store doesn't raise prices, then either their employees are being paid less or the charity they give profits to is receiving less. If rents and house prices are rising and yours isn't, there will still be a reckoning eventually. My housing cost also has not gone up, and neither has my tenant's. However, the houses are still depreciating, the cost to maintain them is still rising, the city and insurance companies will raise prices, they just haven't done so yet. Costs have been rising for me, I just haven't realized them yet. So I guess I am trying to understand why Mustachians might be shielded from widespread inflation. Superficially it makes no sense, except by chance.

Then I thought (late last night) "what if money is not losing value, and what if the thing which is becoming more expensive is not a thing, but complexity itself?" And then I felt like a genius and couldn't think of anything else. I still think that this explanation makes sense. In a world with coronavirus, every physical transaction adds immensely to the total cost of a good. This leads to items with the greatest number of transactions gaining the most in price. Restaurants add complexity to cooking. Eating cows adds complexity to consuming corn and soy. Et cetera.

So in this theory @American GenX and Zikoris both have low cost lifestyles, but Zikoris' lifestyle is also simple, and thus less susceptible to current inflation. And I expect mine is in between, but closer to American GenX. Simplicity and low cost are two tenants of mustachianism which are usually aligned, but in this case are in tension. In fact I don't think I have ever seen simplicity explicitly stated as a core mustachian value, though it usually seems to lurk just beneath the surface.

[JAYSLOL]

In Canada also, and haven’t directly felt much for inflation, but unfortunately with the rise in house prices I’ve basically been priced out of the market in my area.  The (very basic, rural located) house I wanted to buy 2 years ago was $550k, which was just barely out of reach, so we decided to wait and that house is now worth $900k, so I’m basically f’ed. 

[Metalcat]

My expenses have gone up a bit, but the way the internet has been talking about inflation, I would have thought it was a hair-on-fire event instead of just, like, $20 extra bucks a month? I haven't done the math, but I'm not feeling a boot on my back or anything.

It does seem like there are a lot of news articles about it lately. I think it might have more to do with other news being slow: no US election, stock market steadily going up, everyone's tired of hearing about covid, etc.

Well to be fair, as much as I'm not feeling it personally, the multiple businesses I work with are hurting BADLY because of inflation.

So yes, depending on what you have to buy, this could be a very brutal time for some people and a hell of a lot more than $20.

I feel for anyone forced into construction right now because I'm in a role where I'm staring down the barrel of a 9M project that was estimated last year and now I have no idea what the hell it's going to cost.

Those of us with the capacity to personally pivot around this are very fortunate.

[Zikoris]

Then I thought (late last night) "what if money is not losing value, and what if the thing which is becoming more expensive is not a thing, but complexity itself?" And then I felt like a genius and couldn't think of anything else. I still think that this explanation makes sense. In a world with coronavirus, every physical transaction adds immensely to the total cost of a good. This leads to items with the greatest number of transactions gaining the most in price. Restaurants add complexity to cooking. Eating cows adds complexity to consuming corn and soy. Et cetera.

So in this theory @American GenX and Zikoris both have low cost lifestyles, but Zikoris' lifestyle is also simple, and thus less susceptible to current inflation. And I expect mine is in between, but closer to American GenX. Simplicity and low cost are two tenants of mustachianism which are usually aligned, but in this case are in tension. In fact I don't think I have ever seen simplicity explicitly stated as a core mustachian value, though it usually seems to lurk just beneath the surface.

Interesting thought. I would say that my spending is definitely mostly pretty simple by your definitions. Walking versus using anything motorized (or even a bike) eliminates so many intermediate steps of production, labor, repair, etc. I would say that at least half of the food I buy (maybe a lot more, not sure) has one ingredient, and hardly anything done to it after coming out of the ground.

[Stasher]

Then I thought (late last night) "what if money is not losing value, and what if the thing which is becoming more expensive is not a thing, but complexity itself?" And then I felt like a genius and couldn't think of anything else. I still think that this explanation makes sense. In a world with coronavirus, every physical transaction adds immensely to the total cost of a good. This leads to items with the greatest number of transactions gaining the most in price. Restaurants add complexity to cooking. Eating cows adds complexity to consuming corn and soy. Et cetera.

So in this theory @American GenX and Zikoris both have low cost lifestyles, but Zikoris' lifestyle is also simple, and thus less susceptible to current inflation. And I expect mine is in between, but closer to American GenX. Simplicity and low cost are two tenants of mustachianism which are usually aligned, but in this case are in tension. In fact I don't think I have ever seen simplicity explicitly stated as a core mustachian value, though it usually seems to lurk just beneath the surface.

I think you nailed it for us MMM types @Radagast , really love what you wrote here. I never thought of it that way as clear as you have but do know that is something I have explained to friends about why things like their meat or dairy is so expensive. **on a side note why it is also carbon intensive and not good for the planet, all related to inputs and complexity**

[Zikoris]

Then I thought (late last night) "what if money is not losing value, and what if the thing which is becoming more expensive is not a thing, but complexity itself?" And then I felt like a genius and couldn't think of anything else. I still think that this explanation makes sense. In a world with coronavirus, every physical transaction adds immensely to the total cost of a good. This leads to items with the greatest number of transactions gaining the most in price. Restaurants add complexity to cooking. Eating cows adds complexity to consuming corn and soy. Et cetera.

So in this theory @American GenX and Zikoris both have low cost lifestyles, but Zikoris' lifestyle is also simple, and thus less susceptible to current inflation. And I expect mine is in between, but closer to American GenX. Simplicity and low cost are two tenants of mustachianism which are usually aligned, but in this case are in tension. In fact I don't think I have ever seen simplicity explicitly stated as a core mustachian value, though it usually seems to lurk just beneath the surface.

I think you nailed it for us MMM types @Radagast , really love what you wrote here. I never thought of it that way as clear as you have but do know that is something I have explained to friends about why things like their meat or dairy is so expensive. **on a side note why it is also carbon intensive and not good for the planet, all related to inputs and complexity**

Another way to look at it in the realm of food, specifically veg vs non-veg, is the biology concept of trophic levels. Due to biological reality, an increase in the cost of grain products is always going to have much more impact on the cost of meat than anything else, because of the amount of food animals need to eat (90% energy loss when you move up a step, i.e. from plants to herbivores, or herbivores to predators). In a way, the increase in cost is essentially the same way biological contaminants concentrate as they move up the food chain.

[Omy]

That is an interesting way to look at it. I have spent my whole life avoiding complex expenditures. I've never done a major renovation or purchased expensive furniture or cars but instead do a lot of maintenance to keep simpler items functioning. I avoid fancy appliances and keep basic cars until the wheels fall off. I exercise, avoid alcohol, and have a low risk life style to postpone complex medical spending.

When something becomes inflated, I can usually postpone the purchase until prices come down...or come up with a plan b.

[Gerard]

I think my ability to hack things is increasing faster than the rate of inflation. Which doesn't make me immune in any literal sense (because without the inflation my hacking would be doing me even more good), but it does mean I continue to spend the same or less despite hearing people around me freak out.

(I guess it would be crappy to not give a few recent examples: I've learned to forage and garden and cook better, my bartering networks are improving, I've overcome my resistance to longer-distance bike trips, and we're finding more places close to home for mini-vacations.)

wrt Canadian housing prices not making sense given our surfeit of space and wood, I guess that's just another reminder that we're paying for location and status, and to live in the parts of the country with jobs and roads and doctors. You can still get a house in Newfoundland for under $50K (I know because I sold one a couple of years back!).

[moof]

Major expenses are mortgage and food.  Mortgage is fixed, might get easier if my company ever decides to throw money at their retention problems.  Food is only a modest part of our income, so inflation there isn't scary to me.  I have room to downgrade food if needed, but really our income is so high compared to food spending it is silly (about 30x gross pay compare to food spending).  I can easily adjust savings as needed to weather any non-hyper inflation level event.

[Greystache]

I am FIRED in SoCal and I am really not feeling inflation.  I live in a paid off house. I have solar electric so my electricity is nearly zero. I have natural gas heating that has not gone up significantly, but even if it did, I don't use much in this climate. My property tax increases are capped. Since 1994, my property tax has gone up from $3K per year to $4k per year while my home value has quadrupled. Gas prices have gone up quite a bit from a year ago, but are still less than what is was in 2008. A tank of gas lasts me 6 weeks so I really am not sensitive to gas prices anyway. Food has gone up some, but my wife does all the shopping and she's really good at it. We haven't felt food inflation much at all. We have felt inflation in eating out and entertainment, but that is easy to cut back on if it ever gets painful. Healthcare premiums are basically zero, and we are pretty healthy so out of pocket costs are only a couple thousand a year.

[Roland of Gilead]

My property tax increases are capped. Since 1994, my property tax has gone up from $3K per year to $4k per year while my home value has quadrupled.

California should really do something to make that situation a bit more fair for all.   My suggestion is they should recapture the property tax discount you are getting when you sell your house for $$$ since your neighbor who bought their house in 2017 is paying $10k per year for the same space.

[Greystache]

My property tax increases are capped. Since 1994, my property tax has gone up from $3K per year to $4k per year while my home value has quadrupled.

California should really do something to make that situation a bit more fair for all.   My suggestion is they should recapture the property tax discount you are getting when you sell your house for $$$ since your neighbor who bought their house in 2017 is paying $10k per year for the same space.

There is no denying that Prop 13 has caused some serious inequalities and unintended consequences. It seems unfair that my neighbor across the street pays more taxes for the exact same house and consumes the same amount of services. But the courts have upheld the law, so what do I know? I think it also contributes to the housing shortage since retirees are less motivated to leave their homes and move elsewhere.  I know that if my property taxes had risen at the same rate as my property value, I would have left CA when I retired. That said, I don't know what the solution is. It has become one of those "third rail of politics" things. If you touch it, you die.

[lonegun]

Radagast, that's brilliant  insight! I made a note of it!