Who Is to Blame for America's Economy?

The nightly news tells us the dire circumstances our country’s financial state is in, and there always seems to be someone pointing a finger. “It’s Bush’s fault!” “It’s Obama ’s fault!” “It’s Wall Street’s Fault!” Sure, all of these are factors, but have we stopped to look at the choices we have made with our finances? Dare I say it? Could it be our fault for much of the financial problems?

There are very few people who do not have debt- be it mortgages, car loans, or credit cards that need to be paid off, most have something that is siphoning out their bank account. During the 1990s we had great interest rates, so many of us bought, bought, bought. Yes, there should have been better regulatory laws, but then someone would have been shouting, “Get the government out of our choice to spend!” Did we buy what we needed or did we buy what we wanted?

My mother and grandparents lived during the Depression and really knew what it meant to be poor and frugal. Choices of survival had to be made. Now, we see people who have lived their lives in the red lose everything, yet they still want more. It seems there is an “easy” way to cash on every corner, but again, there is a price to pay for that easy money. Maybe it is your car title or a large interest fee if it is not paid off in time.

Here are some tips for either saving yourself financial hardships down the road or to helping you pull yourself out of the hole:

1. Learn how to say no to yourself.

We are a spoiled generation. We see the lap of luxury on TV. We look at what our neighbors have. We put our wants above our needs. For example, we must ask ourselves, “Do I really need this new car?” Then we need to think about what we actually have and how it will fit into our financial plan. “No, I want the new car, but I don’t need it.” We must stop letting our irrational passions outweigh our common sense.

2. We must also learn how to say no to our children.

Consider what you are setting them up for in the real world. Do you want your child or children living with you and off you during their adult lives, or do you want them to stand on their own? Say no while teaching them the difference between “want” and “need.” Most of us are not born with a silver spoon in our mouths and have had to earn our way. We must teach our children they must earn their way too. Teaching them that they are "entitled" to whatever they want is going to be their generation's downfall. Do not contribute to it.

3. Do not try to keep up with the Joneses.

We think we have to have what others have, and we run ourselves into debt so we can appear to be just as good as others. Keeping up appearances is eventually going to come back and turn ugly. We don’t have to have everything that we perceive others have. It is sad to see how many people have lost their homes, cars, and jobs. The more they had borrowed, the bigger the fall.

4. Save as much as you can.

Saving money and teaching your children to save money is always a good thing, but it is not always an easy thing to do. Make a budget and include savings. When I was first married, we had to budget every penny as we lived paycheck to paycheck. We would save five to ten dollars a paycheck. It does not sound like a lot, but it did add up and it was sworn to be off limits. Also, in our checkbook, we would round down any change and hide it in our checking account. This helped keep the overdrafts from coming in. Later, as we started our careers, we started saving more. Always have a cushion no matter how small or how large.

5. Try to pay a little extra on your mortgage, car loan, and/or credit cards.

Paying even five dollars more helps you from having interest charged to those few extra dollars. It does help whittle your debt down, even if only seems a little at a time. Each time you pay above the minimal, you make a dent that eventually starts turning into a chunk of saved money on your end.

6. Do not be ashamed of downsizing.

So what if your house is not as big as your best friend’s. Keeping your head above the constant suction of debt is going to make you happier and healthier in the long run.

7. Live within your means.

I am glad my mother and grandparents lived during the Depression because they passed on some valuable lessons. Many I have had to learn the hard way because of superficial “want,” but many I have benefited from by knowing how to save. Their generation rarely bought anything if they did not have the cash for it. If they had to go without, they went without. My grandparents were very comfortable in their old age and actually had the money for financial planning. They lived frugally and loved generously. My mother did not have much in her old age, but she managed every cent and was beholden to no one. Either way, that is what I want for myself and my children.

We may not be able to control Washington or Wall Street, but we can take responsibility for our own finances. We may be digging ourselves out of a hole, or we may be one of the lucky ones who did not get hurt when the bottom dropped out. It is never too late to start. It may be discouraging, but it will pay off if we all try to live within our means and say “no” to ourselves.

Ironically, I notice that some of the ads for this article are for "easy loans" and "quick cash." I may be shooting myself in the foot, but these are the types of "easy money" loans that have created some of the personal problems and lack of financial discipline. If it is too good to be true, chances are it is not true.