The current economic recession did not cause our problems, it revealed out problems. The reality is that for years, Americans experienced near full employment and economic “boom” times; yet, they chose not to save at all. Instead of diligently preparing for a time when perhaps economic times were not as good, they chose to spend every time they earned and then some. The result is a disastrous scenario with dropping income, zero savings, and in some cases rising costs (mortgage resets).
If there is one thing that we should take from the current economic situation, it is that there is no alternative to real savings. Financial responsibility demands sound money management and continuous savings. Without it, there is no capital to invest, there is no rainy day fund, there is nothing to fall back on. Hopefully, we will find our way out of this economic turmoil, and prepare diligently for the next potential recession by saving money.
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