Comparison is the thief of joy...but has anyone used the CPI calculator lately?

[rothwem]

I got an unsolicited, out of cycle 3% raise in December, but when I looked at the CPI calculator, I realized that I still made less per the CPI calculator than I did when I started my current job in 2018.   I got another 3.9% at the beginning of this month, and it finally put me $1000 over my 2018 income.  I appreciate that they're giving me unsolicited raises, but its annoying that they're so small. 

Has anyone compared their income with the CPI tool lately?

https://www.bls.gov/data/inflation_calculator.htm

[dandarc]

After the first few years at most companies, you usually you have to jump ship or at least get a significant promotion to get more than a COL increase. Tax brackets and so on being indexed to inflation helps a little bit, but yeah - very hard to keep pace during times of high inflation. Good that inflation is clearly slowing down now.

[YttriumNitrate]

After finishing up my taxes for the year, I charted my inflation adjusted W2 income since 2016. My peak was back in 2018. If I didn't like my job, and wasn't relatively close to FI, I'd probably be looking to jump ship to get another significant bump.

[bacchi]

After my team's manager left, a software architect was promoted temporarily to the position. He looked at our salaries and gave a few of us, including me, a substantial raise to better equalize our paychecks with our contributions.

That was the only time that happened. Usually, the big raise came as I was walking out the door.

[rothwem]

After the first few years at most companies, you usually you have to jump ship or at least get a significant promotion to get more than a COL increase. Tax brackets and so on being indexed to inflation helps a little bit, but yeah - very hard to keep pace during times of high inflation. Good that inflation is clearly slowing down now.

Yeah, I just kinda figured that with the labor shortage and inflation, they might actually be more proactive about retention.  Buuut they're not, and everyone is leaving.  Strange circumstances. 

[dandarc]

After the first few years at most companies, you usually you have to jump ship or at least get a significant promotion to get more than a COL increase. Tax brackets and so on being indexed to inflation helps a little bit, but yeah - very hard to keep pace during times of high inflation. Good that inflation is clearly slowing down now.

Yeah, I just kinda figured that with the labor shortage and inflation, they might actually be more proactive about retention.  Buuut they're not, and everyone is leaving.  Strange circumstances.

Or they're just waiting on the fed to tank the economy so the labor shortage goes away . . .

[Alternatepriorities]

DW nearly left her position over this issue two months ago... Story on the epic FU money thread, we have other reasons for staying another year now and allows her to more than offset their sad contract offer.

Interestingly when I was doing our taxes I noticed on her W2 that her employer's cost of health insurance had gone up more than $9k in the last two years... It's clear they are getting a bad deal on that and need to find a new provider, but that is probably at least part of where her raise went...

I've also noticed over the last 2 years that wages are going up a lot more at the bottom than at the top. Honestly while that's not great for us engineers, it's really about time. Sure their wage growth will "lock in" inflation but as the fed as made it clear for decades that they fear deflation more that inflation, I suspect it's already locked in.

[GilesMM]

Your personal inflation rate can be vastly different from CPI do it may not be relevant. Are you spending more for the exact same stuff?

[Alternatepriorities]

Your personal inflation rate can be vastly different from CPI do it may not be relevant. Are you spending more for the exact same stuff?

This is very true for us. Unfortunately it works against us because the things that have seen the least inflation are things we don't tend to buy. Meanwhile the "volatile" food and energy that they leave out of the CPI have been hit particularly hard and I live in a place where food is shipped in so it's been hit even harder here. Last year the inflation rate in Anchorage was 19.5% No ones salaries kept up with that.

Fortunately I get most of our meat from the wild land around me. Unfortunately ammo has seen hyperinflation.

[GilesMM]

This is very true for us. Unfortunately it works against us because the things that have seen the least inflation are things we don't tend to buy. Meanwhile the "volatile" food and energy that they leave out of the CPI have been hit particularly hard and I live in a place where food is shipped in so it's been hit even harder here. Last year the inflation rate in Anchorage was 19.5% No ones salaries kept up with that.

Fortunately I get most of our meat from the wild land around me. Unfortunately ammo has seen hyperinflation.

CPI (linked by OP) includes everything. "Core inflation" excludes food and energy but it is not too different from CPI (5.5 vs 6.5% or so).

[Alternatepriorities]

This is very true for us. Unfortunately it works against us because the things that have seen the least inflation are things we don't tend to buy. Meanwhile the "volatile" food and energy that they leave out of the CPI have been hit particularly hard and I live in a place where food is shipped in so it's been hit even harder here. Last year the inflation rate in Anchorage was 19.5% No ones salaries kept up with that.

Fortunately I get most of our meat from the wild land around me. Unfortunately ammo has seen hyperinflation.

CPI (linked by OP) includes everything. "Core inflation" excludes food and energy but it is not too different from CPI (5.5 vs 6.5% or so).

Sorry my mistake. I was thinking more about the things we don't buy than my terms. It's frustrating to hear "Inflations ~9%" when my typical Costco trip is 20-30% more. Even the reported local inflation seems to be running behind our household inflation. Best as I can tell it's because things like consumer electronics, appliances, and entertainment make up a smaller part of our spending that the average consumer.

[Mgmny]

Your personal inflation rate can be vastly different from CPI do it may not be relevant. Are you spending more for the exact same stuff?

This line of thinking is why the government's calculation is BS. Sure my food bill "inflation" may not be as much as X%, but that's because now instead of buying beef, I'm buying pork. Instead of having an occasional diet coke, I drink water from the tap. So yeah, my grocery budget may have not gone up 20% in the last 2 years, but the stuff I'm buying is different to help compensate for it.

[yachi]

I'll second what others have said - that raises are larger when you jump companies, and not enough when you stay.  Early in my career I didn't see raises higher than inflation even though I was gaining experience quickly.  Prior to the last couple of years inflation has been low for so long that it doesn't surprise me companies aren't raising salaries enough.

One thought that used to help me find comfort was that the raise applied to my entire income, including the portion that I use to pay the mortgage (which didn't increase for inflation), and the portion I use to pay my student loans (which also don't increase for inflation).  I've kept these as a sort of inflation hedge over paying them off as part of the FIRE journe.

Today I'm FIREd over a year, and while inflation is one of the things that can sort of torpedo this thing, I'm a bit too busy to run a comparison.  I have some savings for future expenses that may or may not materialize, so it's hard to know if inflation has raised the bar to where I need to change my plans.

[rothwem]

Your personal inflation rate can be vastly different from CPI do it may not be relevant. Are you spending more for the exact same stuff?

I'd actually wager that we're more exposed than average, the only thing we've locked in is our housing, which is admittedly 42% of the CPI.  But for food, the prices that have gone up are for staples, which is really what we buy the most of.  Oatmeal, eggs etc.  Our grocery bill for four is up at least 20-30% in the last two years. 

I'll second what others have said - that raises are larger when you jump companies, and not enough when you stay.  Early in my career I didn't see raises higher than inflation even though I was gaining experience quickly.  Prior to the last couple of years inflation has been low for so long that it doesn't surprise me companies aren't raising salaries enough.

Well yeah.  I've been working since 2009, and I always got ~3% raises that were just over the minimal inflation rate at the time.  The shitty raises were justified by the fact that inflation was low, and so there wasn't much need to compensate me for it.  But now that inflation has really gone nuts, and every week we lose another engineer, I just would've thought that the company I work for (a giant Fortune 500 company) would be more proactive. I'm surprised that they're not.  My sister works for a large gov't agency and they've been almost throwing money at her and her colleagues to get them to stay. 

[StarBright]

I should not have looked at the calculator :)

In actual buying power I'm making almost exactly what I was in 2010.

But in a way, I'm sort of glad I looked because I feel like I make SO much more, but also still feel like my dollars aren't going any further. Welp- it's because they aren't!

Thanks for sharing!