Consumer Finance Still Out of Balance

All things continue to make clear that consumer finance is still out of balance. The US has evolved from a saving nation to a colossal debtor nation. Our national savings rate has fallen below 2%; the lowest in history. From 1980 to 1994 the US saving rate averaged 8%. That's a 5% drop in 14 years.

What's happened to the average American? Why have most Americans not prioritized saving? The answers to these questions are as varied as the selections at a Las Vegas buffet. No one reason will ultimately explain this trend. However, one thing is clear, if Americans do not start to prioritize saving, they risk loosing their self-reliance later in life. In our prime earning years we become very accustom to self-reliance. This independence is slowly eroding away for Americans who are not prioritizing saving for retirement.

The time to start saving is now. No matter your economic position in life, refuse to believe you don't have enough money to start saving. Careful analysis of your budget will most likely reveal where you can cut the fat and pour that money into tax deferred investment accounts. Even if you start with as little as $25 a month. It's a start. It will create a habit that will serve you well as you are able to save more money as your income increases over time.

Links to articles covering similar subjects below:

Federal Reserve Article - Low US Savings Rate

CnnFn - Charged Today. Tapped Out Tomorrow

Edward Jones - Solutions to Investment Goals

Related Wiser Money Articles: December 2004 Archives

The State of Consumer Finance
Saving and Investing in Everyday Life