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Why don't Americans save?
- Thread starter Debaser82
- Start date
Well here goes.. you may go ahead and shoot me if you like.....I might sound like some kook living in a hut in Montana.
There is a pervasive sense of entitlement in this country. Yes, there are a few savers here and there, but the more prevalent attitute is: I'm entitled to my job, entitled to own a fancy car, entitled to all the stuff I see on TV, entitled to own a 5000-sf house, etc.... and now I guess we are all entitled to get bailed out of whatever. So those who chose to buy only what they can clearly see the way to pay for, will pay for those who were profligate.
Where does it stem from? One poster commented on our status as a nation of migrants, thus risk-takers. There may be some truth to this.
Mostly, though, I think we believe that we are entitled to everything because we are taught that pattern of thinking from an early age. Childrearing has been child-indulging for the last fifty years or so. People are no longer taught to work hard, save, or any of that stuff, which is now considered very old-fashioned and foolish.
People I know tell me that they have to buy their kids everything because the kid's friends all have these things. What they are teaching their kids, subtly, is that it's important to keep up with the Jones, and that what other people think about your economic status is important. Do we really want to teach them that?
Furthermore, childrearing is done in a vacuum. Unlike Europe, we live hundreds or thousand of miles from our relatives, so there is no extended family to influence the raising of children or to shape their attitudes. The children are all so busy playing with their expensive computer toy-thing-ies in their 5000 sf homes that they don't interact with the world enough to get a view of how others live differently. The only adult models that kids have are their parents and possibly a teacher or coach; there are no mitigating opinions or influences from other relatives or the rest of society. Of course, there are plenty of criminals and narcissists on TV for them to watch.
My guess is that this indulgence stems from both parents working. I don't suggest we go back to the 50's, but maybe there is some way for people to at least stop throwing things at their kids in lieu of spending time with them. My observation has been that I see a profound difference in these attitudes between people who are my age (52) and younger, as opposed to the generation before me. My older friends just don't seem to believe that the world owes them anything.
I think my parents, who made their share of mistakes, got this absolutely right. When I was young I used to wish I had a dollar for every damn time they said to me, "We're not going to buy that. If you want it you will have to save your allowance, get a job, etc..." So now, I DO have a dollar for every time they said that to me. Strangely, it turns out that, while I could buy a hot car and all the crap I see on TV, most of it's just not that interesting to me. Go figure.
There is a pervasive sense of entitlement in this country. Yes, there are a few savers here and there, but the more prevalent attitute is: I'm entitled to my job, entitled to own a fancy car, entitled to all the stuff I see on TV, entitled to own a 5000-sf house, etc.... and now I guess we are all entitled to get bailed out of whatever. So those who chose to buy only what they can clearly see the way to pay for, will pay for those who were profligate.
Where does it stem from? One poster commented on our status as a nation of migrants, thus risk-takers. There may be some truth to this.
Mostly, though, I think we believe that we are entitled to everything because we are taught that pattern of thinking from an early age. Childrearing has been child-indulging for the last fifty years or so. People are no longer taught to work hard, save, or any of that stuff, which is now considered very old-fashioned and foolish.
People I know tell me that they have to buy their kids everything because the kid's friends all have these things. What they are teaching their kids, subtly, is that it's important to keep up with the Jones, and that what other people think about your economic status is important. Do we really want to teach them that?
Furthermore, childrearing is done in a vacuum. Unlike Europe, we live hundreds or thousand of miles from our relatives, so there is no extended family to influence the raising of children or to shape their attitudes. The children are all so busy playing with their expensive computer toy-thing-ies in their 5000 sf homes that they don't interact with the world enough to get a view of how others live differently. The only adult models that kids have are their parents and possibly a teacher or coach; there are no mitigating opinions or influences from other relatives or the rest of society. Of course, there are plenty of criminals and narcissists on TV for them to watch.
My guess is that this indulgence stems from both parents working. I don't suggest we go back to the 50's, but maybe there is some way for people to at least stop throwing things at their kids in lieu of spending time with them. My observation has been that I see a profound difference in these attitudes between people who are my age (52) and younger, as opposed to the generation before me. My older friends just don't seem to believe that the world owes them anything.
I think my parents, who made their share of mistakes, got this absolutely right. When I was young I used to wish I had a dollar for every damn time they said to me, "We're not going to buy that. If you want it you will have to save your allowance, get a job, etc..." So now, I DO have a dollar for every time they said that to me. Strangely, it turns out that, while I could buy a hot car and all the crap I see on TV, most of it's just not that interesting to me. Go figure.
I believe much of it stems from the US Gummint... they encourage profligate spending and punish saving. The REAL reason the Gummint does that is so it all masks the effects of deficit spending.
When I was a kid, my "things" were a bicycle, basketball, ball glove, chess set, fishing pole... (none of which were bought on credit)
I made spending money by washing neighbors cars, mowing lawns, shoveling snow, babysitting... do kids do these things today?
When I was a kid, my "things" were a bicycle, basketball, ball glove, chess set, fishing pole... (none of which were bought on credit)
I made spending money by washing neighbors cars, mowing lawns, shoveling snow, babysitting... do kids do these things today?
When I was a teenager back in the late 60 early 70âs a welder at any old shop could own and pay for a house, have a wife and kids and he could make it. Also I was earning about 6 to 7% on a savings account.
Today you need two good paychecks to make it. Savings accounts pay less then 1% today. It is no surprise to me that people donât save because itâs a suckers bet today. You donât get paid any thing if you do it. You are probably better off just sticking it in a safe somewhere then putting it in a savings instrument; at least you will get your money back. The inflation figures reported by the government donât even pass the laugh test. They only apply to you if you live in an abandoned auto in a Kmart parking lot and you are on food stamps.
So if you save it and can manage to make say 3% real inflation will eat more then that and to add insult to injury the IRS will tax you on it.
Is it really any surprise that we donât save when the entire system is geared to push people to burrow? The purchasing power of the currency is always going down. The rates paid to savers have all but vanished. I have savings but I view any dollars I have as a wasting asset and I am always on the lookout for hard assets to convert my savings out of the little green coupons.
Today you need two good paychecks to make it. Savings accounts pay less then 1% today. It is no surprise to me that people donât save because itâs a suckers bet today. You donât get paid any thing if you do it. You are probably better off just sticking it in a safe somewhere then putting it in a savings instrument; at least you will get your money back. The inflation figures reported by the government donât even pass the laugh test. They only apply to you if you live in an abandoned auto in a Kmart parking lot and you are on food stamps.
So if you save it and can manage to make say 3% real inflation will eat more then that and to add insult to injury the IRS will tax you on it.
Is it really any surprise that we donât save when the entire system is geared to push people to burrow? The purchasing power of the currency is always going down. The rates paid to savers have all but vanished. I have savings but I view any dollars I have as a wasting asset and I am always on the lookout for hard assets to convert my savings out of the little green coupons.
It is because America and many of it's corporation care about the bottom line and to induce growth, they encourage their penniless populace to go further into debt. "They" have created temptation and greed via credit and interest. "They" suggest consumption thru invisible indebted servitude. This country grows on consumption. The pendulum swings until it cannot and has swung this way for some time now with slave wage in 3rd world countries to produce our goods. At some point, these 3rd worlds figure out if we kick out the debt ridden Americans off our islands and eat all the fish ourselves, we'd be happier. Which is what happens Now. Ultimate destination is socialism.. as is any society that finally peaks and "matures".
Quote from Debaser82:
I live in that pighole of a socialist europe where the government takes 50% of your salary, you don't get to work for your own pockets untill after the summer, and still people over here save more then 10% of their income.
What gives?
Is it because the FED has run a more inflationary course then the ECB eroding the purchasing power of the dollar causing people to search for alternatives?
Or is it the US spirit where people are always on the outlook for the next bubble to grow so they can hop on and become rich overnight?
Or is this how capitalism is supposed to work? If you can't cut it bad luck and good night see you in the souplines?
Quote from mogar:
When I was a teenager back in the late 60 early 70âs a welder at any old shop could own and pay for a house, have a wife and kids and he could make it. Also I was earning about 6 to 7% on a savings account.
Today you need two good paychecks to make it. Savings accounts pay less then 1% today. It is no surprise to me that people donât save because itâs a suckers bet today. You donât get paid any thing if you do it. You are probably better off just sticking it in a safe somewhere then putting it in a savings instrument; at least you will get your money back. The inflation figures reported by the government donât even pass the laugh test. They only apply to you if you live in an abandoned auto in a Kmart parking lot and you are on food stamps.
So if you save it and can manage to make say 3% real inflation will eat more then that and to add insult to injury the IRS will tax you on it.
Is it really any surprise that we donât save when the entire system is geared to push people to burrow? The purchasing power of the currency is always going down. The rates paid to savers have all but vanished. I have savings but I view any dollars I have as a wasting asset and I am always on the lookout for hard assets to convert my savings out of the little green coupons.
100% right, I love how its in vogue now to chastise American taxpayers for not saving. Why the hell would anyone save when interest rates on savings minus inflation is negative??? The government inflation rates are a joke, sure computers & TV's are cheaper now than 10-20 years ago but important stuff, housing, education, health care. food & energy have gone up 500% since the 80's. My grandparents bought their house in the 60's for 9k the same house is worth 800k today. The average house in my town in 500k ( even after the RE bubble burst ) How is the average person supposed to buy a house & start a family without going into massive debt ?
Saving indicates a profound lack of confidence in the future.
worst yet, it is reflective of a severe lack of confidence in YOUR future earning potential.
Invest aggresively, take risks, be flexible, spend and enjoy--its best for everyone...
surf
worst yet, it is reflective of a severe lack of confidence in YOUR future earning potential.
Invest aggresively, take risks, be flexible, spend and enjoy--its best for everyone...
surf
Americans have a strong belief that you are what you think. Therefore, they believe that if you spend your money, and expect more to come in the future, you will always have more money.
Quote from gnome:
I made spending money by washing neighbors cars, mowing lawns, shoveling snow, babysitting... do kids do these things today?
FWIW I'm 21 and did all of the above (minus washing cars) to earn money from the age of ~12 to ~17. I think these teen years are pretty critical for forming your attitudes about money.
Shoveling snow for hours in order to save for something, then getting a $200 speeding ticket, getting stressed out, etc. has a way of teaching you certain values about spending and saving for a rainy day.
However, I would say 75%+ of my generation was not the same way.