Conflict

Today on the front page of the local paper (the Kansas City Star) there was an article about the the conflict that consumers are facing in the current economy.

Basically it comes down to save versus spend: The tendency in times of trouble and uncertainty is to not spend on anything other than necessities while the cure for a down economy is for consumers to spend more. Consumers spending less means less demand for stuff which means fewer jobs. Spending, not saving, is what drives the economy today.

It is a fascinating look at the dilemma facing consumers today. Do I want to help the economy out of the doldrums or do I want to do what I think should be done to prepare for an uncertain future?

The article points out that consumers since the turn of the decade have saved an average of one cent for every dollar spent and are now pulling back on discretionary spending.

For me it comes down to what is prudent and right to do for me? Loralie and I don't have any consumer debt. The Dave Ramsey class really drove that idea home. In fact, we hate debt and are very comfortable not having any.

We've been moving this way for a long time but it is only in the past yhear that we have been able to reach this goal.

It has been a long time since we bought a car using a loan. And our next car will probably be a used one that we buy for cash.

But we will spend when we have the need and we have the cash. For example, we just bought a new bed since we didn't have place for guests to sleep (furniture went out the door to stock kids apartments and houses). But we did our research to get a good deal and we picked it up at the warehouse rather than pay extra for delivery.

When the question: "What's in your wallet?" can be answered: "Cash!" there is a sense of power and security that I can handle the emergency that will happen. I don't have to worry that if the car breaks down I won't have the money to pay for repairs.

And when I have an emergency fund, I know that I can weather a job loss without losing the house.

I guess that what it comes down to is that I am not going to change my behavior just because someone tells me it is good for the country, economy, environment, etc. I am going to change my behavior because I am convinced that it is the right thing for me and my family to do in our situation.

So I'll stick with a budget and with saving and with buying stuff with cash not credit. And maybe it is time for others to do the same...