#The Debt Crisis

It seems most people have a financial problem these days. Apparently, they spent about 160% of their disposable income, which means they live above their means.

I am not surprised. I’m thinking back when our generation was young. When we got engaged and eventually married, we bought a ring for a price we could afford. It didn’t have to be a huge diamond. A nice ring was just fine. Our weddings were not huge. We didn’t invite every person we knew or were acquainted with, and our parents didn’t spend a fortune on our wedding. We got married in the church hall or we rented a small hall in a restaurant. We had no big socials before the wedding, just bachelor parties for the guys. No big dinners, just some guys getting together, playing cards, drinking beer and watching x-rated movies on a small movie screen. There was no sound and they were mostly boring. The women had showers where the women brought small gifts; nothing that cost a lot of money.

After we got married, we usually moved into an apartment, and then we saved for a house. When we thought we were ready and had enough for a down payment we bought a small house, a starter house, and then we saved some more and maybe a few years later, we bought or built a larger house. We moved up slowly. We bought used cars which we paid cash for.

We didn’t have huge screen TV’s (they didn’t exist yet. We felt fortunate when we could afford a color TV. A 20 inch screen was large) and we had rabbit ears. If we wanted to get fancy, we put an antenna on the roof. All we spent was the cost of the antenna. Everything after that was free. The few channels we got were plenty. There is only so much TV time we allowed ourselves. We had rotary dial phones and our phone bills were small. It was good enough to get in touch with friends and relatives. We didn’t have to stay in touch 24 hours a day.

I am, of course, talking about the average people. There are always exceptions, both ways.

Now let’s talk about the way it is now with the young people:

They already go into debt buying a huge diamond ring. The wedding needs to be huge. They hire a wedding planner, because that’s the way to go. In our days we planned our own wedding. We didn’t trust a stranger with that. All that drives up the cost of a wedding.  I’ve heard of weddings that cost up to $30,000.00 (WOW!). You can buy a brand new car for that and still have money left over.

They go on ‘Destination Weddings’. Getting married at home isn’t good enough anymore. And the couple expects the guests, the bride maids and the best man to accompany them at their own expense, of course, not bothering to ask if they can afford it. That, to my mind, is presumptuous.

When the young couple buys a house, it has to be large. A small house won’t do. They need a new car. Interest rates are cheap right now, so they max out on the mortgage and on the loan for the car, not thinking of the future when interest rats go up (and they will!).

They need all the newest gadgets, like a huge screen TV, and as many channels as are available. The movie channel is a must. It doesn’t matter if they have time to watch every program offered or not. They need to buy the newest computer, a tablet, and, of course, they both need their own iPhone, or whatever is the latest fad. The cell phone is important, so they can phone each other and everyone they know all the time; and they need to be able to get to the internet anytime they want to wherever they are. Everybody else does it. They have no conversations anymore when they get together. Everyone seems to be busy checking their messages constantly or texting someone.

Rabbit ears or an antenna on the roof don’t work anymore. The TV program providers have seen to that. They force us to buy their service. And it is expensive.

Now you can subscribe to music channels for your car. For a price, of course. Young people need that. We older folks don’t need them, because of the music offered. I call it ‘noise’. Besides, I’m not paying money so I can listen to my radio in the car. I have a flash drive or CDs with my music.

People spent too much money on all the new gadgets, if they need them or not. They may not even be able to afford them. And that is the problem. Nobody seems to have heard of compromising or ‘sacrificing’. They don’t want to wait until they can afford what they want; they need it right now. That’s seems to be the newest thing. RIGHT NOW.

Well, we all like to do and want things now, like traveling or buying something new, but sometimes we just have to wait. Wait and save, and maybe sacrifice something else if we want an item that costs a lot and may take a large chunk out of our disposable income. Sadly, many people don’t know how to budget. When it comes to mathematics, they seem to have no idea how that works. The formula is simple: You can’t spend more money than you earn. You must balance the scale or end up in a deep hole you may never get out of.

Again, there are always exceptions. There are still people who are reasonable and who think ahead. They buy when things are on sale not when they need them. They make sure they can pay off their credit card bill every month, because they know that once you got yourself into a position where you can’t pay off your debts it is difficult, nearly impossible, to catch up. They buy within their means, what they can afford. They know trying to keep up with the ‘Joneses’ is a foolish thing; trying to pretend they can afford to spent money they actually don’t have just to impress friends and others is irrational and downright stupid.

Unfortunately, the government that is constantly trying to ‘protect’ its citizens from making a bad move by implementing new laws that sometimes don’t make sense, is of no great help. Our new Liberal government will be setting a bad example. They want to borrow money to get the economy going, because interest rates are cheap right now, ignoring the fact that eventually interest rates will rise again. They’ll be plunging our country so deep in debt our grandchildren won’t be able to pay it off.

I’ll leave you now with this unpleasant outlook and glimpse into our future.

Right now we are in the middle of a small snowstorm; perhaps that is the reason for my gloomy mood.

Have a nice day.