Debt Denial
If you don't have ANY credit card debt, save 10% of your pay in a retirement fund for over 2 years, and have 4 months pay in a "rainy day fund" don't waste your time on this article.
IF NOT when reading this DON'T LIE TO YOURSELF.
America's in Debt Denial.
By Peter Davidson • Bankrate.com
The road to financial ruin is paved with plastic.
More than ever before Americans are racing along this highway to hell -- saving less than ever, draining cash from home equity and continuing their unrelenting pursuit of the good life.
They're carrying a mountain of consumer debt, comprising bank and department store credit cards and those "easy-to-get, everybody-rides" auto loans. Americans can't seem to get enough of them.
It's an addiction and, like all addictions, those who are hooked are in denial -- debt denial.
As a result, we're in it up our eyeballs; more than $2.15 trillion as of August 2005, according to the Federal Reserve. All those zeroes translate to nearly $7,700 for every man, woman and child in the United States.
What's more, it's been increasing steadily by billions every year: $1.7 trillion in 2000, $1.84 trillion in 2001, $1.92 trillion in 2002, $2.01 trillion in 2003 and $2.1 trillion in 2004.
Could it be that as a nation we have a lot to learn about personal finance?
In 2004, Bankrate's Financial Literacy Survey showed America earned a grade of "D" in financial literacy.
The statistically valid survey of 1,000 Americans conducted for Bankrate by RoperASW, revealed that a wide gap between what we know we need to do for our financial well-being and what we actually do.
For example, 71 percent said that keeping an emergency fund is "very important," but just 44 percent said they have one. That's a gap of 27 points.
And most said they are worried about the amount of credit card debt in this country but insist that, personally, they don't have a problem. Only a minority of Americans confess to having a problem managing their credit. For example:
· 75 percent say they don't make major purchases on their credit card unless they can pay it off immediately.
· 69 percent said they don't put any charges on their credit card that they would not pay off right away. Which raises this question: Where is all that credit card debt coming from?
Do you have a problem? Are you making good spending choices or are you in denial? To find out if you are in control of your spending, consider these questions:
· Do you know how much you owe?
· If you had to estimate the balance on each of your credit cards right now, could you come close?
· Do you know how much you're paying in interest on your credit cards? Or are you shocked every time the mailman brings you a credit card bill?
IF NOT when reading this DON'T LIE TO YOURSELF.
America's in Debt Denial.
By Peter Davidson • Bankrate.com
The road to financial ruin is paved with plastic.
More than ever before Americans are racing along this highway to hell -- saving less than ever, draining cash from home equity and continuing their unrelenting pursuit of the good life.
They're carrying a mountain of consumer debt, comprising bank and department store credit cards and those "easy-to-get, everybody-rides" auto loans. Americans can't seem to get enough of them.
It's an addiction and, like all addictions, those who are hooked are in denial -- debt denial.
As a result, we're in it up our eyeballs; more than $2.15 trillion as of August 2005, according to the Federal Reserve. All those zeroes translate to nearly $7,700 for every man, woman and child in the United States.
What's more, it's been increasing steadily by billions every year: $1.7 trillion in 2000, $1.84 trillion in 2001, $1.92 trillion in 2002, $2.01 trillion in 2003 and $2.1 trillion in 2004.
Could it be that as a nation we have a lot to learn about personal finance?
In 2004, Bankrate's Financial Literacy Survey showed America earned a grade of "D" in financial literacy.
The statistically valid survey of 1,000 Americans conducted for Bankrate by RoperASW, revealed that a wide gap between what we know we need to do for our financial well-being and what we actually do.
For example, 71 percent said that keeping an emergency fund is "very important," but just 44 percent said they have one. That's a gap of 27 points.
And most said they are worried about the amount of credit card debt in this country but insist that, personally, they don't have a problem. Only a minority of Americans confess to having a problem managing their credit. For example:
· 75 percent say they don't make major purchases on their credit card unless they can pay it off immediately.
· 69 percent said they don't put any charges on their credit card that they would not pay off right away. Which raises this question: Where is all that credit card debt coming from?
Do you have a problem? Are you making good spending choices or are you in denial? To find out if you are in control of your spending, consider these questions:
· Do you know how much you owe?
· If you had to estimate the balance on each of your credit cards right now, could you come close?
· Do you know how much you're paying in interest on your credit cards? Or are you shocked every time the mailman brings you a credit card bill?
posted by MoneyProf at Friday, November 18, 2005
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