Posted on 06/22/2005 8:11:39 AM PDT by mountaineer
You've heard Aesop's fable -- the one about the ant and the grasshopper.
It goes something like this: The ant spends his time industriously storing food supplies for use in the future while the grasshopper lounges around on a leaf, poking fun at the ant. The grasshopper's motto is "live for today," while the ant's creed is "be ready for tomorrow." Then, when winter comes and food becomes scarce, the grasshopper searches for his ant-friend and begs for scraps.
Fortunately, the grasshopper doesn't have access to credit cards, or he'd just go deep into debt feeding his family and paying usurious interest rates for the privilege of doing so.
So which set of values applies to your personal financial situation -- that of the ant or the grasshopper?
The philosophy that best describes our national psyche might be the grasshopper's. In a survey of 38 countries released last week by ACNielsen, the United States ranked first -- top in the world -- as the country with the highest percentage of consumers living paycheck to paycheck. More than a quarter of us -- 28 percent, to be exact -- said we "have no spare cash" after paying for our essential living expenses.
Meanwhile, countries such as the Philippines, India, Mexico, Indonesia and Thailand boast the highest savings rates. These countries ranked at the bottom (a good thing for them) in the no-spare-cash department.
Does the irony grab you by the collar and hurl you across the room?
(Excerpt) Read more at biz.yahoo.com ...
What is it about their cultures that enable them to be better savers than Americans? I can't say for certain, and I hesitate to generalize, but I suspect that folks in many of these countries have more exposure to poverty than do folks in Western countries, and poverty is something they would work on avoiding. They do this by saving money today for tomorrow's possible needs.
The American population, as a whole, needs to understand the trade-offs between saving for the future and living for today. We need to strike a balance somewhere between the adventurous attitude of the grasshopper and the no-nonsense, seemingly no-fun, outlook of the ant.
But if we had to choose between the two, we would do well to adopt the adage of the ant. In the end we really must rely on ourselves to prepare for the challenges that lie ahead.
We are taxed to the point of castration...how can we save?
Well other than the fact that there highway system sucks and most of the 'vehicles' on the road are either bicycles or mopeds, then, yeah.
1) Prior to the 80s you needed a house and a job to get credit. Since then anyone can get credit at high rates and then default on the debt. 2) If you own a house then you feel rich because you can borrow against the appreciation. 3) Lastly, there is an expectation that the taxpayers who save for retirement will support you if you don't. Republicans in Congress agree with this.
available credit in this country compared to the third world locations mentioned is probably a big factor, along with a culture that virtually worships material consumption.
I don't think the human subconscious in many people handles the concept of credit well. If you give a gorilla a banana credit card to get extra bananas in addition to whatever he forages, what is going to happen? That is pretty much how many americans seem to use credit cards and debt in general.
Tell that to people like my friend who maxes out every credit card he can get his hands on...and obsesses about spending the money he has left after paying the minimum monthly amount. I do not believe that people live paycheck to paycheck because thay HAVE to. They make the choice, whether it be conscious or subconscious.
Pish. What's the point of saving in countries where the government can devalue the currency, nationalize the banks, confiscate your savings account, burn down your hovel and dig up the floor? If I lived in Mexico, Philippines, or Thailand, I'd be spending every available (fill in worthless currency unit here).
Man, if we could just get it together like those third-world countries have. /sarc
Last time I checked, you can't take it with you. Americans invest, not save. Saving is a waste of money, IMO.
I'm trying to do it right. Just turned 20, started a life insurance / retirement fund with the KofC. It's about $35/month, with a guaranteed 4.5% return (averages 5.5-6.0%).
One more year of college, then paying off my interest-free loans first thing, while theyre still interest-free. Trying to do this right! LOL
Taxation.
Incorrect.
Buy term insurance and put what's left in a decent mutual fund.
"Man, if we could just get it together like those third-world countries have. /sarc "
Yeah, like all those wonderful 'welfare' programs they have over there! /sarc
If they didn't 'save' any money, they wouldn't be able to live.
Wonder how many of them have credit cards or mortgages for that matter.
It's easy to save, if you have nothing to spend it on.
Other than food that is.
If you save it, the government will take it.
oh i'll be doing more investing in a year and a half, once I'm out of school and have a steady income. Thanks!
My cousin started building up her credit card balances to such a point that she had to go to credit counseling and cut up the cards by the time she was 30. She just couldn't grasp the distinction between the things she needed and the ones she wanted. I don't think she paid off all her debt yet, but she's back to spending more than she can afford. It's a trap a lot of young people don't know how to avoid.
KofC is an excellent insurer. We have a number of policies with them. The younger you are when you start with a policy, the less you will ultimately pay.
Vexed by the paltry savings rates among Americans, politicians have introduced tax cuts to get us to save. They've come up with numerous breaks designed to motivate us to hoard money for retirement, for education, and for the sake of saving itself. While on one level we welcome getting tax breaks, we don't always make the connection between taxes and savings. And that's probably because our tax code is extremely difficult to understand, something we only deal with when absolutely necessary.
She seems to talk only about the psychological aspects of saving/investing vs. spending, even when she describes those from other countries:
What is it about their cultures that enable them to be better savers than Americans? I can't say for certain, and I hesitate to generalize, but I suspect that folks in many of these countries have more exposure to poverty than do folks in Western countries, and poverty is something they would work on avoiding. They do this by saving money today for tomorrow's possible needs.
Had she addressed such things as taxes, governmental monetary controls, the relative standards of living, etc., it would have been a much more complete discussion.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.