This sign used to hang over the walk-in pantry of my old Folk-Victorian farmhouse named, "Heartsease* Cottage". It now hangs as the sole focal point on the entry hall of my condo I've named, "Heartsease Haven".
My "simplify" sign is a reminder to maintain simplicity in all I do whether it's cooking, decorating, expending time and energy, or gardening. Simplicity is definitely a factor in my philosophy of Elective Frugality - one of my "Cottage Lifestyle" attitudes for a good and happy life.
Rather than acting upon media messaging and marketing propaganda to buy more, whether I need it or not, the inherent simplicity of living the Elective Frugality philosophy results in a simpler, more content and peaceful life. I enjoy, and am more grateful, for what I do have, all while spending less money.
The simple fact of having money in savings, instead of owing money and interest to banks and mega-corporations, gives me freedom and options. It also gives me peace of mind and a sense of security.
Our unrestrained consumerism buys CEO's jets, mansions, yachts, tall buildings, islands, jewels, Congressional representatives, and a more forgiving legal system.
Personally, my choice is to put a wee cork in the outflow of my money into corporate wealth by enriching myself and my life by saving money, buying only what I need, allotting space - not storage - to the few things I need, and buying needful things and luxury items with $cash$, rather than with ongoing, high interest credit payments.
This year, in the first quarter of 2019, consumer spending contributed to 68% of the U.S. economy ($14.25 trillion dollars in the first quarter of the year). This figure usually hovers around 70%. I researched these figures from the Bureau of Economic Analysis that tracks and reports these findings.
According to the Bureau, 2/3's of the 68% was spent on housing and healthcare and other services. About 1/4 was spent on "non-durable" products such as groceries and clothing, while the remainder of consumer spending included automobiles, appliances, and other expensive items.
The reality remains that most people in so-called "developed" countries, regardless of income are simply wasting some - often about a third, or more, of their income - on things they really don't need and the resulting payments and interest.
Regardless of income, most Americans (aka consumers) live right up to, and even beyond, their income falling further into debt to have needless stuff. Ever-deepening debt puts people at risk of losing their homes and automobiles when a "rainy day" comes in the form of illness, job loss, or a recession.
By the way, I resent being called a "consumer"! It diminishes my feelings of person-hood. When did we cease being "citizens" and become "consumers"?
Probably this happened around the time that the benefits and equal-opportunity entrepreneurship of Capitalism devolved into the stricture and elitism of Materialism...
Capitalism has "soul" and opportunity for all within the system. Within it, healthcare, prescriptions, education, housing, and entrepreneurship are available to all at reasonable costs. Government works for all citizens, not only the elite. All are equal under the law.
Materialism is "soulless". It works for the uber-wealthy, owns our legislators, and the law is applied unequally and unfairly. Benefits and necessities escalate in cost under this regime.
Lifesaving treatments and medicines become cost-restrictive for the populous, and are instead the perks of the super-wealthy. Wages stall, jobs are shipped overseas, so called "tax breaks" are permanent for the wealthy and temporary and minimal for the rest of us. Education becomes un-affordable to the majority of people.
Organizations that work for the benefit of the people are stifled, diminished, and abolished. Minimum wage laws and unions that promote worker's rights cease to exist...and the gap between those that "have" widens as more and more people discover that they're ability to "have" is less and less.
These realities are now well under way as the dark side of Materialism overtakes and warps honorable Capitalism, which was meant to exist to benefit all. It is up to each of us to save ourselves from runaway Materialism and the rampant greed that fuels it.
If we ignore the advertising and marketing propaganda to buy needless things (aka going into debt to have these things) we instead gain security, contentment, and save ourselves a lot of stress, anxiety, and worry. We are more likely to weather the coming recession, as well.
Many economists are predicting another recession, the undertow of which has already begun. NOW, if you have not already started, is the time to begin reducing your debt-load as quickly as possible. An article in the Chicago Tribune, (https://www.chicagotribune.com/business/ct-biz-recession-economists-survey-20190225-story.html), as well as other sources, reports that 75% of economists predict that the downturn toward another recession will begin to become more apparent by the end of 2020 and catch up to us during 2021. Many are already feeling the ripples of the coming recession...or is still the persistent after-effects of the previous recession?
Eleven percent of economists believe that somehow we'll be able to skirt the predicted recession. Is that wishful thinking, or are there some who have a $vested$ interest in the public's continuing naivety to continue to spend as if there's no no danger lurking ahead in the form of another recession?
Do most of us even know about the likelihood of another recession in the next two years? Why aren't we being made aware of this possibility?
It's time to question whether we need to buy that new car, give our kitchen that costly $50,000 remodel, and to put off buying all the wonderful tech-gadgets that seem so appealing. Do we really need to buy more clothes right now?
Can we get by for awhile on what we already have?
Perhaps we should all consider the idea of putting some money into savings to see us through what may come.
Isn't it wiser to keep what we already have for the next few years and pay down debt as rapidly as possible in order to survive the next recession?
Whether the next recession comes in a year or two, or five, or ten, it will come because our system is so imbalanced. There is too much wealth at the top of the food chain and not enough distributed among those that actually keep our economy running...we, the people!
If your income is such that you can afford an expensive remodel without going into debt (or additional debt) that is wonderful and you've managed your money well. By all means, go for it. You're providing jobs and not risking your own well being. This is how it should work!
Debt enriches the mega-corporations. Corporations don't care if you can't afford healthcare, if have enough food to eat, if want to educate your kids, or if you lose your job. They won't be there with a bailout (maybe a high interest loan, if you qualify), but they (or their minions) will be there to evict you from your indebted home, or tow away your debt-encumbered vehicle. Then life gets really tough.
There are still victims of the last recession living in tent cities or in their cars. The majority of these people lived and believed that the "American Dream" included them, too. They worked at careers and jobs, paid mortgages, taxes, paid into 401-K's, bought goods and services, all the while believing that they supported an economy that, in turn, supported them. And, they went into debt to have things that the "system" told them they needed and deserved...and...they lost it all.
Consumer spending is the major cause of the recovery from the most recent recession about 10 years ago. Profligate greed was the cause of the recession.
Before the recession, consumer (there's that word again, and again) spending and confidence maintained the GDP (Gross Domestic Product) growth rate at a healthy 3.5%. In the 10 years since the last recession it has only recovered to 2.5% to this day.
Economists consider this as a "soft" recovery. It is still considered "healthy", but our consumer-driven economy has not yet fully recovered to pre-recession levels. It may not have a chance to do so if 75% of economists are right about the proximity of the next recession.
There are many people who've still not recovered from the loss of homes, 401-K's, automobiles, and jobs. For these people there has been no recovery to this date. The next recession will knock even more of us into poverty and lack. Shouldn't we each do something to protect ourselves, our loved ones, and our assets?
Statistics place the "fault" of a soft recovery upon slowed consumer spending and other factors. The "blame" falls upon consumers who've had a "shift to thrift", as they term it. Perhaps blame needs to fall on those that caused the recession because of corporate greed, instead.
This "shift to thrift" means that people are seeking out deals and lower prices. It means many of us have reduced our expectations from having quality goods to accepting poorly made, less costly, imported goods, but still more of them...
Many of us no longer cared, or dared, to return to our pre-recession standard of living. We learned that the American Dream, as it now is being promoted, is not dependable or available to all. We consumers took the hit of the last recession while the government bailed out the very banks and corporations that caused it!
Still, in spite of consumer wariness and our supposed "shift to thrift", our collective debt rose this year from $4.042 trillion to $4.052 trillion in just the first quarter! Economists present the following causes for lack of complete recovery...
The aforementioned "shift to thrift". Although we're buying cheaper goods, we're still increasing our collective debt buying more of these goods.
The cost of education and auto loans are the greatest drivers of consumer debt presently.
Do you remember when the government issued low-interest loans for education to nearly everyone? These loans were easier to pay back and often forgiven if one simply agreed to work in a depressed area or provide much-needed services for awhile.
Then, the banks saw an opportunity to make even more money. Today Federal loans average 4.5% - 7%, still relatively low. These are now generally poverty-based. Most of the population simply cannot qualify for them and are driven to get bank-managed, "private" educational loans with interest rates that can run as high as 13.5% to 15.14% (...God only requires a 10% tithe...). Do you see a pattern of corporate enrichment here?
Education loan rates are as high as many credit card rates! One might as well charge one's education to a credit card! Education costs have accelerated beyond the financial ability of the average income earner.
Some parents opt to take out equity loans on their homes to assist an adult child in getting an education. This choice can place many who are on the cusp of retirement (and a lowered income) onto a financial hotplate.
Furthermore, many graduates must put off buying a home or starting a family until much later in life in order to pay off these loans. The fact that getting an education is now out of the reach of most people unless they acquire a loan adds to an every increasing personal debt. This is not a user-friendly system! Nor is this how Capitalism is meant to operate.
Income inequality has hurt the ability of the average citizen to pay for housing, food, medical costs, and acquire education, let alone acquire goods and services. Average incomes simply have not kept pace with growth in either the stock market or for goods and services. The rich are getting richer and the majority of us are getting poorer.
The cost of living goes up, but wages and retirement income lag behind, falling farther behind each year.
Being a millionaire in today's economy doesn't mean what it did a generation ago. Only the mega-billionaires are getting ahead. For the rest of us it's become hard scrabble. And, it's making us sick, stressed, and miserable.
This economy is no longer designed, or able, to "lift all boats". It's designed to lift only those in control of it...those who can afford to "buy" legislation, countervailing our votes in order to enact policies, perks, tax breaks, and "deductions" engineered to benefit the extremely wealthy while the rest of us fund their extravagant lifestyles and those obscene corporate subsidies doled out by Congress.
Outsourcing of jobs has hit workers hard. I'm still waiting for taxes and fines on companies that move outside the U.S. So far, it seems to be more electoral propaganda geared to curry our votes. While tariffs are passed on imported goods from U.S. companies overseas, Congress then passes tax breaks to those same U.S. companies to compensate them for money lost paying the tariffs. Go figure. One more way the system is rigged against us.
Consumer confidence hasn't returned to it's pre-recession high. Thus, while people are spending somewhat less on quality goods, we're buying the cheaper items, but also more of them than we need.
It remains a fact, that regardless of income, whether two-figure, or six- or even seven-figure, people still have the dangerous habit of living and spending right up to, and beyond, their income.
After the last big recession, President Bush told the American people to go out and spend to help rebuild the economy. Spending and indebtedness does contribute to the growth of the economy as it is presently operated.
In order to live in this country and survive in this economy, we must support it to some degree...by buying needful things! But, we don't have to spend and buy and go into debt to our own detriment by buying frivolous things! We must set aside savings for our own needs and well being. We must also get over the false belief that our Government is there to help us.
Today, most of the population has no savings. None! Most live up to and beyond their incomes, instead depending upon credit cards to fill their income gap between paydays. This is dangerous and unsustainable. Each and every one of us must take back our $power$ in order to survive, not only the next recession, but others that are sure to come.
I retired many years ago and quit being a good little "consumer" buying things I didn't need, had no room for, or had to pay to store...or buy countless little bins to "organize" those many needless things.
I no longer buy the needless, the current faddy or trendy "must have" item. Yet, I still manage to have everything I need, and much that I want. I'm not deprived. I enjoy a cellphone, a laptop, and an e-reader. My home is nicely decorated and in a desirable, if not "elite" location. I do drive an older car which I've kept in prime condition. It runs well and takes me where I want or need to go.
And, I no longer carry personal debt...and I'll tell you how I accomplished this and had great creative fun doing so.
In my next post I'll cover some of the Elective Frugality strategies that we can all adopt to help us live within a system that's geared to fleece us of our financial well being if we allow it to. In future posts, I'll share the measures to which others have gone to live an independent and debt-free life.
We'll "sew up that hole in your pocket" and stop the outward flow of your hard-earned dollars! And, the good news is that you can begin right now! It's your decision to make as to the many options available as you begin to practice your own version of Elective Frugality and bring both simplicity and savings into your life!
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Referred to as "Heartsease" by the Victorians, these small violas were believed to ease a troubled heart. Today in plant catalogs and nurseries, these wee and charming plants are sometimes called "Johnny-jump-ups.
Elective Frugality is the genteel recognition of having acquired "enough", and that authentic abundance and real wealth are not money- or thing-based, but are, instead Soul-founded.
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