For the first time in way too long, American's are actually saving.
Are you saving for your future? More now than ever before American’s are keeping their money either in the bank, or under their mattress, preparing for whatever might be around the corner. And it’s a good thing, because after this recession people might actually be realizing that they shouldn’t take money for granted.
According to Bloomberg News, American’s are borrowing less money during this quarter then last, and with the more layoffs and rising unemployment rates, the amount that is borrowed will continue to drop as the amount in savings will rise, simply because people won’t spend any money. There isn’t a person out there who feels secure in their job right now, and that fear has made us become more frugal.
American’s are not only saving money, they are also trying to pay back their debts as quickly as possible, perhaps hoping to have that paid off credit card in the garbage and that extra money under the pillow. It’s not drastic fear that is driving people to do this, it’s the reality that we were spending money like it was going out of style, and now we understand that living within our means might be a better option.
With the lack of spending and the abundance of saving, the hopes of our economy recovering quickly might just be down the drain. Without consumers making purchases and going on vacations, our economy will probably crawl to recovery. However, with more consumers saving directly to their bank savings accounts, it might keep interest rates down because banks can sell bonds instead of making new loans.
It seems that people are taking the time to balance their lives, and their spending. Many, including myself, are sitting down as a family and deciding what’s important to spend money on and what can be cut back on, much like every state across the country right now. With the money saved from cutting back, their investing in their savings accounts.
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