The true inflation rate is closer to 10 per cent than five, and may even be higher

amcluesent

The painful truth is that the price of just about everything under the heading of middle-class discretionary spending — as well as many daily necessities — is rising at well in excess of the official Retail Price Index inflation figure of 5 per cent

"I’d guess the true middle-class inflation rate is closer to 10 per cent than five, and may even be higher. If you don’t believe me, start with the basics and scrutinise your grocery bills.

So it has dawned on most of us that we have considerably less real money to spend today than we did before the onset of the financial crisis — real, that is, in inflation-adjusted, after-tax terms.

We know that the middle classes have to bear the brunt of fiscal adjustment. We’ve been braced for that since long before the general election — since it became blindingly apparent that Gordon Brown had lost control of the public finances, in fact.

But we didn’t bargain for a punitive bout of inflation on top."

The destruction of the Middle Classes commences

"Mummy, will I ever know anything other than grim, grey, grinding austerity?"

marklv

Not sure about this. Looking at my outgoings, the biggest exits are housing related (mortgage, house insurance and council tax), transport related (car, rail season ticket) and food. I don't believe all these are rising at 10% at present, though next year might be a different story.

Maybe I'll emigrate to Switzerland: http://www.bbc.co.uk/news/world-europe-10886215

I've already seen jobs equivalent to mine in Zurich for twice my UK salary!

nicko33

"I’d guess the true middle-class inflation rate is closer to 10 per cent than five"
We don't want you to guess.

StevieJ

You wouldn't have liked the 70's :eek:

Malcolm.

Which is another reason why house prices will not crash. Physical (long term appreciating) assets act as a hedge against future inflation. It woulld take a severe blow to disposable income and numbers in employment to see the crashes of the scale many on here predicted.

Really2

marklv wrote: »

I've already seen jobs equivalent to mine in Zurich for twice my UK salary!

I am sure I have read in terms of cost of living you need to earn 3 times to be around the same.

RenovationMan

I'm sorry, but this is reall poor journalism. It would seem that as far as the Telegraph is concerned, only Middle Class people use Trains, Car Parking and No-Frills Airlines. A lot of the other items that have gone up are laughable, such as 'tickets to the West End' and 'genteel literary festivals'. The remaining items mentioned are the same for everyone, regardless of class (such as groceries).

While it is hard to avoid buying certain items, we can all reduce our own personal inflation. For example, I have completely eliminated my 'West End and genteel literary festival' inflation.

It's really not difficult to arrange your finances to cut out all of the waste and to focus on the necessities. Perhaps the Telegraph's definition of Middle Class is a group of people entirely incapable of reining in their spending.

marklv

Really2 wrote: »

I am sure I have read in terms of cost of living you need to earn 3 times to be around the same.

I'm sure this isn't true. Nowhere in Europe is as expensive as London for public transport and housing costs.

Andy_L

Please define this "middle-class" of which you speak :-)

Stompa

nicko33 wrote: »

"I’d guess the true middle-class inflation rate is closer to 10 per cent than five"
We don't want you to guess.

Indeed, if I had to guess I'd say it was less than 5%.

Generali

If you read the article it's basically a moan. Your kids not being able to find work and so coming back to live with you after they leave uni isn't inflation!

This bit is a cracker from the article:

I nearly fainted in the deli when I was told that the £13.40 sticker on a kilo bag of “Yorkshire Dales Granola” was not an error. Nearby, a small jar of local honey cost a startling £6

Imagine, £13.40 for 1kg of granola. Anyone got Bob Geldorf's mobile number? Or perhaps the URL for Occado?

On the income side of that equation, many professionals have been working for the past couple of years for reduced rates and on a less than full-time basis. Many salaried private-sector managers, if they’ve still got jobs at all, have gone without annual pay rises even to cover official inflation.

This is what we economists call, and please let me know if I'm getting too technical, 'a load of old b0ll0x masquerading as news in August'.