Do Americans Have Too Much Debt

by Lee Beattie

Why are Americans Climbing Out of Debt?

We hear every day that Americans live beyond their means as a matter of course, needing to drive or wear the newest and best just because. And it’s true that about 44% of Americans live with at least some “bad” debt such as credit card debt. While certain kinds of debt, such as student loan payments or mortgages, are actually “good” debt because they give you something for your money that’s truly going to benefit you (such as an education or building up equity in your home), much of the debt that gives Americans trouble today is credit card debt or other “bad” debt for which they’ll get nothing in return – and will likely pay whopping interest rates and charges on besides.

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?

American looks at several factors that determine economic growth in order to feel the economy as a whole is healthy. I am sure you are asking what is economic growth? Look right in your neighborhood, look in you city sure it is all around you. This could mean better jobs, people in general are working more so in short they are creating more money flow and in turn more purchases are being made. Many factors play into a healthy community but the most important factor is the amount of money being spent. To determine right away if the money spent is debt or earned look immediately at how this impacts you and your budget. In the overall scheme of things your money spent looks like growth but in your case it was actually debt. So it is very obvious that it is perceived as growth as a whole but your personal economy is not nearly as healthy as it was prior to that purchase and it has put a serious debt.

So there is an expectation for Americans regarding the way that budgets are managed more wisely without going into debt until the economy as a collective whole can comprehend how to and the economy’s monetary health or possible sickness in regard to real money instead of erroneous reflected in dollars.

A budget diet isn’t such a bad idea for most Americans look to our economy leaders and see that as a whole they have accumulated in excess of 12 trillion in debt. Individually speaking most people have not completely figured out how to cut back properly and it shows with how they manage their expenses.

In the meantime, what can you do to rein in your own spending, if you need to? That’s right. Put yourself on a budget, and if you’re in debt, get out. This means swapping lattes at the corner shop for homemade coffee, putting a moratorium on buying new clothes until you’ve actually worn what you have in your closet, and paying off your present car and driving it for a few years instead of trading in for a new one every couple of years “just because”. Of course, if you’re rolling in dough, you don’t have to do these things. But the fact is, most Americans aren’t rolling in dough and to have to cut back on spending. So figure out what your basic needs are, take care of those, and cut back on the rest of your spending until you’ve got credit cards and other “frivolous debt” paid off.

You never know? We as a society could quite possibly be role models to the government in regard to the spending habits and balancing debt.

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