Spending More than We Earn
Americans spend 1.5 trillion dollars on their credit cards each year. Sadly, over 40% are spending more money than they are earning. Studies show that people spend far more money using credit cards than they would spend if they were paying with actual dollars.
In the ten years between 1997 and 2007, consumer debt went up a whopping 75%. In that same time period, the median household income did not increase at all, but that didn’t stop the trend toward spending.
Daniel Indiviglio, in the Atlantic, described American’s recent love affair with debt. He compared the average debt of an American in 1948 to someone in 2010, while taking population and inflation into account. His startling findings showed that debt went from $1,186 per person in 1948 to $10,168 in 2010, not including mortgages or home equity loans.
This trend is not explained simply by the rise of materialism but is also due to the trend towards sending more kids to college than ever before. The expectation that a college degree will secure a high paying job is, unfortunately, no longer a promise that can be fulfilled.
According to a recent poll conducted by Forbes Woman and the National Endowment for Financial Education, 59% of parents are still financially supporting their adult children aged 18 to 39 who are no longer in school. In order to do so, these parents are making significant sacrifices such as taking on more debt, delaying retirement, and denying themselves vacations, homes, and privacy. What message does this send to our next generations of adults?
In spite of economic trends, more Americans are choosing to do cosmetic surgery (rather than reconstructions after accidents or illnesses) than ever before. …