Wages and inflation

Inflation is hurtful but mostly over a long period of time. If we have 4% inflation and wages are going up 5% then overtime this works out very well for the average person. For example if you gross $40,000 and you have expenses of $35,000 you have $5,000 of disposable income. Fast forward ten years. You are now earning $65,155 and you have $51,808 of expenses leaving $13,346. Your disposable income almost triples. This is the situation we had during the fifties and sixties. From 1950 until 1965 wages increase 3% per year and inflation was 2.2%. If you earned $3,500 and had $3,000 of expenses you had $500 of disposable income. By 1965 your income had increased to $5,400 and our expenses rose to $4,150 leaving you with $1,250 of disposable income. Today we have inflation at 8.3% and wages rising at 5.3%. If this continues over the next three years what will our situation look like. The average family income today is $63,000. Assume you have $60,000 of expenses and $3,000 of disposable income. Now move forward three years and your income is $73,500 but your expenses are $76,200