From the Guardian comes an interesting interactive which displays long-term trends in disposable income among different age groups in different countries. Students start by entering an age and a country (all G-8 countries are represented) and then see a series of charts that show three different analyses:

• How has the specific age group seen their real disposable incomes, taking into account inflation, change since 1979?
• How does their age group stack up with the same age group in different countries? Are they better off than their peers in other countries?
• How do they compare with a different age cohort in their own country? Has their disposable income growth fared better or worse?

A comprehensive chart shows the trends since 1979 for each age group for each country allowing for easy comparisons. For example, it is clear from the charts that 7 of the G-8 countries have seen significant declines in disposable income for 20 somethings, while the older generations have benefitted from rising incomes over the past four decades.

How to use this as an activity?

• Have students work through an example using the 20-24 age cohort (the youngest available) and answer the following questions:
  • What is a definition of disposable income?
  • What has been the change in disposable income for this age cohort in the U.S. (or other country) since 1979?
  • What was the impact of the Great Recession on disposable incomes (2008-2010)?
  • When did the largest drop occur for this age group?
  • What are potential causes for this sharp reduction in disposable incomes for young people? Do a webquest and find at least three good sources that explain this change.
    • Here’s an article from the Atlantic which captures more recent trends.
  • The Y-axis in the chart measures “distance from average.” What age group in the U.S. hovers around this average? What is the relationship between age and distance from the average? How would you explain this?

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.