It was as once stated, ” It is better to have loved and lost then never to have loved at all.” Well something is always better than nothing, however when it comes to money for the things middle-class income Americans have been used to, will soon be passe . We’re not talking about the extravagant choices like private jets and yachts. Let’s stick to the basics, and straight up necessities so we can gauge where we stand.
Who doesn’t like to take vacations, especially when you work a job that you really don’t like. A vacation is an extra expense that many middle-earners cannot afford without sacrificing something else. In 2014 , 54% of people gave up buying big ticket items like big screen televisions or electronics , so they could go on vacation. Trips to the movies, and to your favorite restaurants would also have to be given up. I remember working at FedEx and they offered the employees to buy back their vacation time and there were quite a few who took up the offer. Research shows that vacation improves productivity and health. If you enjoyed your work like many entrepreneurs there would not be such a dire need to take a vacation.https://www.priceline.com/?refID=PLMPSTRAVEL&refclickID=MYE6809E
New vehicles tickle most of our fancies. Interest.com shows many households are stretching dollars more than they should. High price tags do not hinder Americans from driving new cars. Experian reports the average loan amount for a new vehicle at the end of 2016 hit $30,621 the highest on record. The average loan term for a new vehicle is 68 months (5 plus years). Even used vehicle loans have an average duration of 66 months. Meanwhile, the average monthly payment for new and used cars totaled $506 and $364, respectively. Suffice it to say just financing a vehicle is not as easy to do as times past.
Finally, how many middle-earners have sufficient ‘ Emergency Savings ‘? Just about half of Americans are placing almost nothing aside for the future. A report from Bankrate.com finds that 38% of Americans don’t have enough money in their savings or checking accounts to pay for life’s little surprises such as $500 car repair or a $1,000 emergency room visit. If a financial emergency arises, 22% plan to cover the bill by reducing spending elsewhere, 16% say they will borrow money from family and friends, and 12% depend on credit cards to make up the difference , which leads to even bigger problems down the road. Folks, let’s face it, life is an emergency! The better we can solidify our personal economies the more we will be prepared for the inevitable, and allow us to continue to live the lives we are afforded , and do better as we are presented new world financial strategies .
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Thanks to Erika Rawes for her article, “10 Things the Middle Class Can’t Afford Anymore written October 11,2017
By Tyrone H. Muhammad
Executive Vice President
Do For Self Enterprises