Earning Online from Panama

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

What Is It with Americans and Debt?

We as a society find out day after day that American people live well beyond their financial means and it shows by the cars that we drive and the clothes that we wear. It is a statistical fact that 44% of the American population has encountered some type of bump in the road and the lingering shadow of debt has slowly trickled into a bad credit situation and a good example of this can be found right in your wallet, that’s right that credit card debt stares you right in your face everyday. Now not all debt is completely bad, there is good debt such as a student loan payments or mortgage payments and these give you many advantages such as an education or equity in your home but most in that 44% have bad debt and which has no real upside financially because of the high interest rates and hidden charges.

More and more Americans are living paycheck to paycheck, not saving for retirement or a rainy day, and living far beyond their means. But it might surprise you to know that the American economy itself really encourages this type of behavior. Why is this so?

Because in America, economic growth is seen as key to a healthy economy. And what is economic growth? You guessed it. Yes, it means more and better jobs, more people working, and making more money, but it also means more people buying more things. In fact, a large part of economic growth is based on how much we spend every year. And guess what? This number (how much we spend every year) is not split up between how much of that is debt and how much of that is actually money of our own that we earned. It simply says we spent X amount of dollars to shop. That’s right. It means that a large part of that number could actually be you going into debt to buy those goods, but it actually looks like “growth.” In fact, this is a fake measure of how healthy our economy is, because your own personal economy is certainly not healthy if you’re in debt to get things you don’t need and that will not give you a positive return in the long run, such as an education would.

Developing a picture in regard to how financially healthy or sick the American economy is can be highly regarded as a selfless mirror in regard to the way the economy spends money and manages a budget and with that our budget shows overall.

With the national deficit being in excess of 12 trillion dollars Americans more than ever have less of of a role model on how to manage a budget. All be it the country could stand to go on a budget diet and so should you.

If needed pulling back the reins on your spending habits might be beneficial don’t you think? Actually a budget might not be the worst thing to because the overall goal here is to get out of debt and have debt free living going forward in your life. If you want to know the easiest ways to cut back are to stop getting that cup of java or stopping at McDonald’s on the way to work, stop picking up those movies on that impulse buy and please instead of leasing or buying another car drive the one that you have now atleast for another few years. You know everyone is not a billioinaire with money flowing because most Americans have to work hard for those spendy toys that they have. You have to figure out what your basic spending needs then all the true debt acquired such as car payments, credit cards or can be paid down and eventually paid off because all of the frivolous spending has been cut out and those miscellaneous debts can be paid off.

Who knows? We just might provide a good example for the government if we all do our part as American citizens to be good role models.