Friday, June 10, 2016

    They Say "Financial Worries Cloud Optimism."  Is This True For You Too?

  By Willie Thomas Butler

As we approach the mid-year point of 2016, Americans are still skittish about getting back into the stock market, buying large ticket items such as homes and cars, or of incurring more debt through student loans or credit card use.  In one sense, this could prove a good thing long term.  Americans have had one of the world’s lowest personal savings rates among highly industrialized nations.  During our Great Recession (2009 – 2013) our savings rate did climb slightly almost hovering around 5.5 percent.  But, it did not last as the economy—based on increased jobs creation—seemed to signal that spending is okay again.

Don’t Sing “Auld Lang Syne” Just Yet!

On the other hand, perhaps we are not done with the most obvious object-lesson, namely, that your lifestyle should not outpace your budget, assuming you have one.  Rather, your budget should help you form an appropriate lifestyle with realistic spending, saving and investing goals.  Otherwise, the return to a much happier time economically may never materialize, at least to some.  Here’s why.

“Based on this latest survey from Northwestern, it seems Americans’ money worries aren’t going anyway anytime soon.”  And, last year, the Pew Charitable Trusts surveyed 7,000 households and determined that "financial worries cloud optimism." Only 21% of those surveyed by Pew were planning to retire and 36% said their households had no savings.

“Our findings show that despite a steady economic recovery, many Americans continue to feel vulnerable,” Erin Currier, director of Pew’s financial security and mobility project, said in a statement when the survey came out in March 2015. “Many worry about their finances, and record numbers — more than 9 in 10 — say it is more important to them to achieve financial stability than it is to move up the income ladder.”

In fact, the last recession has been so impactful in altering traditional optimism after a long protracted period of no growth or significant change that many have settled on simply hoping to keep their head above water.  After all, it only takes one major repair or health-related expense to put many Americans in a difficult financial bind.  And, the older you get, particularly as you become a Social Security and fixed income recipient, the tendency is to hope and pray all the more for no calamity or unexpected issue to arise that requires the household budget revert to “robbing Peter to pay Paul,” so to speak.

The Most Constant Event In Life Is Change

So, what amount of optimism should we seek and embrace given these statistics?   Are there scripture verses that might encourage an individual to have faith in a God that cannot fail us?  Or, does the average person need something more than good spiritual inspiration?   Could people everywhere actually be witnessing and experiencing something more than a lack of optimism toward future financial security and their economic outlook? 

Our next article will address both obstacles and opportunities for the remainder of 2016 and beyond.  Remember, the two will always co-exist, but that does not mean that opportunities won’t outweigh challenges.  It is all in the perspective that one embraces. 


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