As gas prices continue to rise, Katie Ruppe, a sophomore education and journalism major at SMU, will be digging even deeper into her allowance pockets in order to fill up her car’s fuel tank.
“My mom gives me money to pay for one tank of gas a month, everything else I pay for myself, so the higher gas prices have really started to cut in to my allowance,” said Ruppe.
According to the Bureau of Labor Statistics’ Consumer Price Index report for March, the price of gasoline won’t be the only necessity causing financial stress for SMU students. The prices of electricity and food have also been rising.
Professor Tom Fomby, Ph.D., specializes in econometrics at SMU. According to Fomby, these price increases will impact the way students spend and budget their money whether they live on or off campus.
“It will be difficult for everyone. Commuting costs and costs of food affect commuters and on-campus students,” said Dr. Fomby.
The index measures changes in the retail prices of goods and services. The index measures changes monthly and compares them to previous years.
In March, the index for all urban consumers increased 0.9 percent. This represents a four-percent increase from March 2007. According to Fomby, a 0.9-percent increase is very significant and points toward recession.
The price of gasoline was the largest contributor to this increase. The prices for fuel oil increased 10.1 percent in March. When compared to March 2007, fuel oil prices increased a staggering 48.4 percent.
Caroline Snabes, sophomore sociology major at SMU and current resident of the SMU on-campus apartments, fears that moving off-campus next semester will increase the amount of time she spends driving. This would cause her to put more money toward fuel costs. Snabes said that it’s important for students to start finding alternatives to the costly price of gas.
“We need to find alternate fuel sources. I think all cars should be hybrid. I’ve noticed a lot of students getting bikes…I should probably get one,” said Snabes.
For many students living off-campus for the first time, paying attention to utility costs is a learning experience. Those students can expect to see slight increases in their electricity bills as the index for electricity rose 0.8 percent.
Kelly Fordham, a sophomore business and corporate communications and public affairs major who lives off-campus, has been dealing with electricity costs for the past year. Fordham, who pays for her own utilities, says she is concerned about increased prices. However, Fordham hopes that she will save on energy costs by moving into a more energy- efficient apartment during the 2008-2009 school year.
Increased electricity costs will also affect SMU students who plan on living on campus in the 2008-2009 school year. This year, the cost of living in an on-campus residence hall ranged from $3,235 to $4,365 for the fall semester and $2,100 to $2,900 for the spring semester. Next year living on campus will cost $3,550 to $4,840 for the fall semester and $2,315 to $3,175 for the spring semester.
The cost of food also showed a slight increase in March. Overall, the indexes for food and beverages and for grocery store food rose 0.2 percent. Specifically, prices of cereal and bakery products rose 1.3 percent in March. Bread prices also rose 2.1 percent. This marks a 14.7 percent increase when compared to March 2007. The price of milk declined 2.2 percent but still remains 13.3 percent higher than last year. The index for fresh vegetables rose 2.0 percent.
Increased food prices have hit SMU’s dining facilities. The cost of purchasing a meal plan will also increase next year. First-year students required to purchase the “Plan A” meal plan will pay slightly more than this year’s freshmen. The cost of Plan A, which includes 50 “Flex Dollars,” will increase from $2,047 per semester to $2,110 per semester.
Increased prices of daily necessities, talk of recession and fear of a difficult job market have not escaped the lives of SMU students. Whether through hearsay, the news or economics classes, students are paying attention to where their money is going.
In a survey conducted by SMU student Rachael Morgan, 95 current college students and five recent graduates were asked questions regarding their feelings toward the economy. Out of those students, 68 percent said they are worried about the current state of the economy.
Estella Nunez, a junior at SMU, lives at home in Dallas and commutes to school. Nunez says that her parents have recently started to emphasize the importance of keeping an eye on prices, but Nunez worries that when it comes time to move away from home, dealing with the economy will be difficult.
“Right now I only pay attention to gas prices. My parents pay for groceries and utilities. But now, especially with the economy being so bad I’m freaked out about having to worry about other costs,” said Nunez.
But, there might be reason to have hope for the future. According to Fomby, the economy generally operates like a bell curve. In the trough of the curve the economy is in recession. And while a recession may cause financial hardship for students currently trying to enter the job market, the average length of a recession is 11 months, leaving room for a light at the end of the economic tunnel. For those students fearful about entering a difficult economy, Fomby offered this advice:
“First, get a job. Students need to be more risk averse, rent smaller apartments and live closer to their place of work.”
