One Good Thing About This Economy....

[Flamingo]

Driving to work the other day and listening to news and/or Good Morning America on the radio (I can get Channel 6 on the radio in my area) as I do Monday through Friday, it was quoted by someone (some financial expert) that one good thing that will come out of this economy is that many people will start living within their means. Think about it...

[One Half Full]

I personally think that people try to live in their means. Most people going bankrupt or defaulting on loans are doing it because of things like Medical bills, highly inflated housing loan rates. Once that credit card payment gets to be too much and you are only paying minimum payments, you can take 20 or 30 years to get out of debt. This is not a credit system, it is "Share-cropping" it is eternal debt servitude. For some reason it is assumed that we all are highly knowledgeable of the mortgage industry or something. All of the "risk" has transfered from the banks to the masses. These people are predators, nothing more. I tend to see this as the American equivalent of the French Revolution.

[justplaintired]

I believe that living within our means will become a way of life. We lived within our means for a very long time. What threw us was cuts at my DH job. Then my job got slow. Charging became more a necessity then anything.

However, some of it was plain and simple spending out of control and bad choices too. CC make it easy to buy things you should technically wait on. With a card why wait? So now we relearn to wait. To buy what we can afford because basically we have no choice. And that is fine with me. After we are out of this, I am opening a savings acct. Even if all I can afford to save is $10 a week, I don't care, it's more then we have been able to save for a very long time.

[nc73]

I don't know about that. I think some will learn their lesson but most won't. As long as credit exists, there will be spenders! I say ban all forms of credit.

[Willy13]

We have had two boom and bust economic cycles in the last decade. Good luck trying to figure out what living within your means is in this instability. I wonder how many people were well within their means in 2007 and now are bankrupt. Best bet is to save as much as possible and spend as little as possible I guess. But then again, that kind of kills the economy doesn't it. Bit of a catch 22 if you ask me.

[lovebirds]

Easy credit actually pushes up the cost of everything. Maybe inflation will relax for a bit.

[momisery]

When I was 20 I had a little savings account, and my tax return was saved every year. I had a company pension, and healthcare was paid for even if I didn't need it. The DDS and my car were my biggest expenses. Being a girl, I had a girlfriend for a roomy we split a 2 bedroom place. We could afford new cheaper cars, car insurance, and we still managed to go out on the town a bit, bought new clothes, and saved a little. The last decade has been the toughest. I make more, but healthcare has gone nutty and so has car insurance. Clothes do not last they are all chinese and junky materials. Good food is expensive and I never was much of one for junk. Entertainment is nuts too. When min. wage was 1.65 I could buy a ticket to see pink floyd for 6.00 and have a great seat. Sports games are over the top too. True, some have lived beyond their means, but for most average people costs have outpaced our incomes, we did not get hooked on 30 year home loans instead of 15, 5-7 year car loans instead of 3, or using credit cards for dental work or car repairs until we HAD too. Wages have dropped, it is in the news again today that our incomes are back to 1997 levels, but of course the upper incomes are still going up.. slower, but still going up. That is what got us into trouble.

[kenshirley]

Yes, many have been forced into to it many ways.
My daughter, son-in-law and our newest granddaughter are moving here and in with us to try to find work here.
They are so far under they will join us in BK in the next 60 days. They have no choice in the matter.
In their case the loss of a $70k a year job for her with no hope of getting another job like that did them in.

[southernbelle]

The economy and BK have certainly been eye openers for me. In the past I've been known to charge things I didn't need just because I thought I needed them. Easy credit was too tempting. Now that I'm post BK I am living within my means and cash/debit cards for almost everything I purchase which keeps me in check.

[frogger]

one good thing that will come out of this economy is that many people will start living within their means. Think about it...

I have not always lived within my means, but over the past few years, I haven't had a choice about it. I have had to live "under" my means, just to survive and try to pay.

I'm looking forward to a clean start and can assure you that my family will be living within or under our means for the rest of our lives.

[adviceplease]

Bankruptcy was the reality check I needed to start living within our means. I guess the bad economy helped me get there though.

[momisery]

Living with in your means is pretty hard nowdays. In the late seventies we had a crushing recession too because of gas prices everywhere, and heating diesel for homes in the upper midwest. The end result was job loss and companies relocated to the south to avoid the rising costs of heating. Over the years they have moved overseas to avoid the cost of labor and healthcare. We can not afford to work service industry jobs, and buy imports, so yes we will have to change. The message has not reached the top yet, they never thought this would effect them.. but it will. Companies are cutting back, healthcare is going up again, the cost of everything is mostly... and incomes are sinking back to 1997 levels. So, people are stuck with assets priced at 2007-2009 prices, with 1997 incomes. I would say living within your means is an oxymoron.. impossible to do without cutting back so much that more and more people are laid off .. it is a vicious cycle, but until business leaders realize that people need money to buy from them, we will continue down that path. They now have a GLOBAL economy, more people buying world wide, so this could take longer than I will live. Someday, I hope they wake up before they ruin our nation.

[Never_Again]

Over the years they have moved overseas to avoid the cost of labor and healthcare

I suppose that avoiding taxes that continue to be imposed by our ever larger growing government couldn't have anything to do with it?

Credit, in all of its forms, drives the price of all commodities up. It increases the money supply, and it all goes on supply and demand. More money available increases the demand for goods and services, and therefore increases the price.

Think about it... what would a house cost if you had to save up and pay cash for it? How about a car?

I am very happy, and at peace living within my means. Do I miss going out to be able to just buy something, and pay later? Sometimes... I do like to buy things, but forcing myself into cash really does something to you psychologically. Even if I had $40,000 in the bank in cash, would I go out and buy a $40,000 car, knowing that in five years, it may be worth $15,000? Probably not!