Archived

This topic is now archived and is closed to further replies.

Snowguy716

Personal savings rate lowest in 75 years

21 posts in this topic

http://www.startribune.com/535/story/974062.html

This is definitely worrying. People are living beyond their means which could have serious repercussions for the economy in the not-so-distant future. How do we encourage people to save money?

Madonna's Material Girl comes to mind as a good description of today's society.

I think a good public service campaign would be something to the tune of:

"Enjoy savings of up to 100%. Stay home and put that money in a savings account."

Share this post


Link to post
Share on other sites


Well, if they did away with the income tax and put a 20% tax on everything you bought, I think that would encourage less spending, and thus more saving.

I honestly can't believe how people run up the credit cards. I knew a guy who was proud of the fact that he had 60K on his Visa and made minimum payments on it every month. This as back in 1989, too.

You're right. Having so many peole that close to personal bankruptcy is really worrying.

Share this post


Link to post
Share on other sites
Well, if they did away with the income tax and put a 20% tax on everything you bought, I think that would encourage less spending, and thus more saving....

Share this post


Link to post
Share on other sites

^I'm with you on that. The only thing we owe on is the house, and we'll pay that off ASAP, probably the next couple of years.

I think people are conditioned by the media to spend, spend, spend. Funny thing is anyone who lived through the epression is the exact opposite.

Share this post


Link to post
Share on other sites

There's an epidemic of young adults, especially college students, running up ridiculous credit card debts. I know countless people my age who have thousands of dollars of credit card debt they built up doing crazy spending while at school. I never will understand this, I've had a credit card since I was 16 and I've never once even carried a balance. It's a very easy concept: don't spend money you DON'T have!

Share this post


Link to post
Share on other sites


Social Security is social insurance that anyone who works in this country has at least a sustenance income when they get old. I don't think anybody believes they should not be saving because of it because the amount of money that one would get from SS is very small. However, I recommend that you spend some time volunteering in a senior center or soup kitchen and then come back an tell us that it is right to take away that piddling income from seniors that depend on it just to live.

I am glad that we have not gotten to be such a cold cold country that we can't take minimally take care of seniors no matter the circumstances that might see them reach retirement without much money. Thank god for Social Security.

Share this post


Link to post
Share on other sites

I think the point he was getting at is that you could accumulate more money for retirement if you invested the 7.5% you contribute to SS, and the 7.5% your employer contributes.

I know I'd rather have that money to invest myself.

Share this post


Link to post
Share on other sites

Social security will never go away and it will never be privatized.

Capital gains taxes should not be repealed outright. We should encourage people to work for their money, not just play the stock market.

I think repealing the tax up to a certain amount for proceeds going towards retirement saving is a good idea.. but not just outright.

Also, it always helps to set aside a certain percentage of your pay, no matter how big to savings before paying bills. Even if it's only 5%, put it in the savings account and forget about it until there's an emergency. It's always a good idea to have enough saved so that you could live for a month without being paid. And this is plausible for any income level, really.

Share this post


Link to post
Share on other sites
I am glad that we have not gotten to be such a cold cold country that we can't take minimally take care of seniors no matter the circumstances that might see them reach retirement without much money.

Share this post


Link to post
Share on other sites

I was going to say that we've become apathetic, but that's not true. We care about all the wrong things and are completely self obsessed. Those are hardly characteristics that are desirable.

Every time I hear the president say "God bless America" I cringe. I think we've been blessed too much. It's turning us into lazy, bitter, selfish imps that slog through life like a cog in a machine... this leads us to try and make ourselves happy with material things, hence the negative savings rate.

The dichotomies are terrible:

We're the fattest, yet most diet obsessed nation on the planet.

We try to fix all of our problems with pills.

We work constantly and then don't know what to do with ourselves during vacation time.

We are a sick nation.

Share this post


Link to post
Share on other sites

I constantly hear ads on my favorite rock station for FeedThePig.Org, which is about this topic. This opened my wife's and my eyes to how much we've been spending, and we've put outselves on an extremely strict budget for the next couple months so we can begin saving again. I'm currently stashing away 10% of my salary, but that's not going to be enough in the long run, especially since we're not putting away ANY of her salary.

"We're the fattest, yet most diet obsessed nation on the planet."

Oh so true. I'm fatter than at any point in my life right now, and as a result my health has gone downhill... and I'm only 26. I once was diet and fitness obsessed, and I KNOW how to live right but I refuse to. Up until about 3 years ago, I was running anywhere from 20 minutes to an hour and a half EVERY single day. But what happened to that? I also used to save money as well. ;) To save for my first car, to save for my wedding, to save for my house... I had to stash away a lot of my money. Yet today, I spend like I'm Donald Trump.

Share this post


Link to post
Share on other sites


I think that it is funny that they call it a negative savings rate and not debt... because that is what is happening.

I don't understand why people want to live beyond their means. I don't owe money on anything and I put more of my income into saving than what I spend.

Share this post


Link to post
Share on other sites

I think a loan is pretty much a must for buying houses these days. It amazes me that my grandparents bought a $10,000 house in Bloomington, MN in 1951.. which was about 2 years of income for my Grandfather.

People are increasingly moving into $300-500k houses that would take several years to pay off even if they pulled every penny together to pay the mortgage. People say it's just the market, but it's not. My grandparents lived in an 1800 sq. ft. tract house. They have never and never will live in the 4000 sq. ft. gargantuan houses that are being built across America these days.

People are living beyond their means, and while real income has not risen in quite some time, our expectations have grown. It's harder for us to afford eating out because we're paying for twice as much food as would have gotten 50 years ago. When McDonalds first open, a standard meal was a regular sized cheeseburger (it was a little bigger than today's standard cheeseburger, but it was not 1/4 pound) with a standard small pouch of french fries and a small pop.

I now see people eating tripple whoppers (3/4 pound of meat) with a king sized order of fries and a king sized 32 oz. drink. A 32 oz. drink has 416 calories and about a third of the average person's carbs for the day. Not too mention the 2500 calorie burger or the 1000 calorie order of fries. Tha'ts enough calories right there for nearly 2 days of eating in one meal.

And we wonder why we feel sluggish and down all the time.

And you're right Michaelskis, this will have to be a change from the bottom up. The government can take action to encourage saving and making these changes, but the changes will have to come willingly from a populace educated about finances.

Share this post


Link to post
Share on other sites
I think that looking to the government to solve our spending/ saving problems is only going to lead to more problems. People need to stop being little immature children in a I WANT IT NOW mode, and start growing up. Other than a house, if you can

Share this post


Link to post
Share on other sites
There's an epidemic of young adults, especially college students, running up ridiculous credit card debts. I know countless people my age who have thousands of dollars of credit card debt they built up doing crazy spending while at school. I never will understand this, I've had a credit card since I was 16 and I've never once even carried a balance. It's a very easy concept: don't spend money you DON'T have!

Share this post


Link to post
Share on other sites

It is a good idea to have a credit card. It's just not a good idea to use it. I have two credit cards. I used one to pay for books for school and the other is for emergencies. I can get by just fine with a debit card for online purchases.

I ran into trouble trying to keep up with things when I was in Europe, so my grandfather, who worked as a financial analyst for Northern States Power for 40 years, helped keep things in line. It's nice to have someone you trust as a cushion when you're in a foreign country by yourself.

Share this post


Link to post
Share on other sites

you will all be pleased to note that i have never had this much money in savings and retirement accounts in my entire life. I have found that it is quite easy to save money if you have it automatically taken out of your checking account, or pay check, and put in an account you don't have an atm card or checking account attached to. I have one of those ING orange accounts and i put a % of my paycheck in every pay period and it is just enough so that i don't miss it and it is adding up, plus it has a 4.5% interest rate which is better than most CDs. I dont' mean to schill for ING but it is a product that has really improved my ability to tuck money away, and not touch it.

Share this post


Link to post
Share on other sites

  • Recently Browsing   0 members

    No registered users viewing this page.