Author Topic: When does $60 gain - $28 added expense = a net loss?  (Read 1902 times)


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When does $60 gain - $28 added expense = a net loss?
« on: May 11, 2018, 09:47:37 AM »
Had to just laugh when I read the quotes from a lady in this story about higher gas prices wiping out the savings for some in the Trump Tax cuts.

My favorite part of the story,

Felicia Smith, 51, of Silver Spring, Md., says the tax cut overall has left an additional $30 in her biweekly paycheck, and the money is automatically going into a savings account.

“Thirty dollars is not going to make or break me,” she says. But, she adds, the higher gas prices are “killing me.”

... Smith, who commutes 35 miles to her job as an office manager, says she’s spending about $7 more on her weekly fill-up.  As a result, she’s driving fewer days and combining errands — such as to the supermarket and hairdresser — and eating out once a month, down from her usual twice.

Although she’s still coming out a bit ahead after figuring in the tax cut, the higher gas prices seem more tangible, she says."

That's some interesting math there.  Also love the juxtaposition of the quotes about $28 more/month "killing her" right after she says the $30 more a paycheck is not going to "make or break" her.   Which is it? Hah ha.  Although to be fair, I guess its nice she's eating out less and combining some car trips.   Just goes to show that people are often programmed to feel the pain from a negative more than the high from the positive.


  • Handlebar Stache
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Re: When does $60 gain - $28 added expense = a net loss?
« Reply #1 on: May 11, 2018, 11:02:51 AM »
"Higher" gas prices are killing her. Was she reduced to eating cat food a decade ago?  Prices are still low compared to what they've been in recent memory - and back then she didn't have that extra $30/month. Kudos to her for being more efficient with her spending though.


  • Pencil Stache
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Re: When does $60 gain - $28 added expense = a net loss?
« Reply #2 on: May 11, 2018, 11:52:50 AM »
($30 * 26)/12 = $780

($7 * 52) = $364

780 - 364 = $416 leftover per year, which means an extra $16 per week to go towards this weekly fill up that is so necessary.

Sounds like she's adjusting to using the car less often so might get to keep most of it after all.

Also kind of simple / clickbait to compare tax cut income increase to price of anything.

Bye Felicia.

I'm a red panda

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Re: When does $60 gain - $28 added expense = a net loss?
« Reply #3 on: May 11, 2018, 12:24:36 PM »
People who are just measuring the difference in their take home pay may be surprised at the end of the year, possibly in a good way or a bad way.  Unless you did some impressive math to account for your withholding to be at $0 at the end of the year (and having been there in previous years), getting an extra $30 a paycheck is a kind of meaningless measure.


  • Magnum Stache
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Re: When does $60 gain - $28 added expense = a net loss?
« Reply #4 on: May 11, 2018, 12:39:11 PM »
Typical loss aversion.  It hurts more to get money taken away that it does to make less by the same amount. 

I'd rather make $10 less than drop a $10 bill into the ocean.  I'm not saying it makes sense, but it's definitely the case.


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Re: When does $60 gain - $28 added expense = a net loss?
« Reply #5 on: May 11, 2018, 02:24:34 PM »
IDK -- it seems that she gets the idea that she has more $$ net.... only that "the higher gas prices seem more tangible".

Folks, that is the EXACT secret of "pay yourself first".  When it comes onto / off of your pay stub automatically, it is very easy to not notice any impact.

It is like MAGIC.

Just Joe

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Re: When does $60 gain - $28 added expense = a net loss?
« Reply #6 on: May 16, 2018, 09:36:56 AM »
I saw a clip on the news some months ago about teachers driving across a state line to make more money. This one teacher they focused on was driving about 80 miles each way to make more money. She was driving those miles in a full size (I think) 4WD pickup. Would have been easy to sell it and buy just about any car and be money ahead.

The article reminds me of people worrying alot about some tiny expense when they have all sorts of other inefficiencies they could eliminate.
« Last Edit: May 16, 2018, 09:39:47 AM by Just Joe »