I just read a fabulous book about our economy and some real hard fact about what's going on right now and how America is dealing with this "new" kind of financial situation most of America are in.
The title of it is "Smart is the New Rich: If You Can't Afford It — Put it Down"
by Christine Romans.
Here are a few excerpts from it. Take a look. I think you will find it pretty interesting and informative. The following are her words, not mine.
More people are on food stamps than in college.
•Foreclosure notices were issued at a rate of 322 per hour last year.
•There were 5.5 job seekers for every job opening at the beginning of this year.
•Nearly $7 trillion in U.S. household wealth was wiped out in this current recession. (how big is a trillion): If you spent $1 million every day since Jesus was born, you still would NOT have spent a $1 trillion dollars.)
She says there's only one way to deal with the recession she's dubbed "the new normal." You can't control your job, investments or home value, she says, but you can control how you spend.
The average consumer has $7,701 in credit card debt, $177,186 in home mortgage loans, $14,873 in auto loans and $27,777 in student loans. With a record number of Americans out of work for more than six months, Romans doesn't want us to live within our means. She wants us to live below them.
She says we should think about money the way we think about nutrition. Consider random spending the money equivalent of junk food. It might feel good at the time, but it hurts you in the long run and limits your options later in life.
Romans suggests readers adhere to "retro rules" — the money sense their Depression-era grandparents followed.
The nut of it is asking, "Can I afford this?" rather than, "How can I afford this?"
And, as the book's title says, "If you can't afford it — put it down."
The book dishes helpful tips for job-seekers. Some are the usual fare, but several will supply light-bulb moments for many readers:
•Looking for work? Be aware that potential employers may run a credit check on you, because fraud often stems from employees who live beyond their means and are having trouble paying their bills.
•Most managers spend 10 seconds scanning your cover letter and 10 seconds on your résumé, says Brad Karsh of JobBound career-coaching service. "You have to think of the cover letter as a movie trailer," he says. Make it fast-paced and exciting, and use a narrative hook to pull the reader in.
•Eighty percent of today's job openings are hidden. They're never posted or advertised because they get filled by personal referral. The most important line in a cover letter is the one that contains the name of the person you and the hiring manager both know.
Romans' reporting delivers advice many readers may not have heard, including the counterintuitive answer to:
Do you use your credit card for every purchase and faithfully pay it off each month?
Who knew that could make it look like you use too much credit, because you're getting close to your credit limit every month? That can lower your credit score just as you apply for a loan.
56% of us still do not have a budget, and 30% of us have no savings.