Monday, November 16, 2009

Stimulating the Piggy Bank

Savings in the US is slowing increasing, despite the spend, spend, spend mentality in Washington. Maybe we are beginning to learn a valuable lesson - you cannot spend your way out of debt. Now, if we can only get Congress on board with this idea.

from NPR's Weekend Edition

For nearly two years, the U.S. economy has been struggling with a recession brought on by excessive borrowing, both for home mortgages and consumer purchases. Economists say many people have learned a lesson; the personal savings rate is inching back up as more Americans embrace the "new frugality."

Still, half of U.S. households don't have even modest savings, according to a new study conducted by TNS Group, a market researcher, with help from professors at the Harvard Business School and Dartmouth College.

The researchers conducted a survey to see how many households could round up $2,000 within 30 days to cope with an emergency, such as having a car breakdown or needing a major home repair. About half said that even if they turned to relatives for help, they could not come up with $2,000 for a "rainy day," the study found.

Read or listen to the entire story here.

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