Everyone has heard the phrase “keeping up with the Joneses,” and it means doing the things every person else is doing to keep status. Flat screen TVs, iPhones, riding lawnmowers and other things are bought instantly with people who have this instinct. The Joneses are more concerned about getting rid of debt instead of spending on their credit cards.
Household debt falling, says Fed
The Federal Reserve gave out a new report. The report shows all of the numbers for household debt in America. The recession came causing numerous to change their minds. Numerous decided it was really important to get their debt paid off. Nobody will do poorly with debt consolidation. The Wall Street Journal reports that debt levels have gone down for seven quarters. Second quarter of 2010 showed a 1.5 percent reduction from the past quarter and a 6.5 percent reduction from the previous peak, in 3rd quarter of 2008. In just three months, $ 178 billion of debt was paid off. That’s a lot of individuals basically giving themselves a cash loan each month.
An additional warning
There is more happening right now. The increased savings and falling debt in the household is not the only thing happening. Consumer debt is going down. But delinquency has gone up a bit. The delinquent debt rate went down. It went down about 0.5 percent. Unfortunately there’s another thing to consider. Bankruptcy went up 34 percent. It seems fewer people are using paycheck loans to keep up with paying for credit cards, as 272 million accounts were closed and only 161 million opened. Credit card companies aren’t doing all that well. They might need their own emergency cash loans.
Getting rid of debt
Overall, more Americans are trying to get rid of debt. Instead of getting a new card, many just pay their cards off. There are more people going bankrupt though. More people are interested in getting cash for themselves. This means getting out of debt is a number one priority.
Wall Street Journal
blogs.wsj.com/economics/2010/08/17/ny-fed-households-continue-to-reduce-debt/
