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Anyone see the CBS News on another decline in Savings rate?
Old 07-31-2006, 07:25 PM   #1
 
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Anyone see the CBS News on another decline in Savings rate?

The snippet on the evening news claimed that around 50% of Americans are just making payments and not saving anything. About 12% were not earning enough to pay the bills and had to borrow more to make it.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 07-31-2006, 07:29 PM   #2
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Re: Anyone see the CBS News on another decline in Savings rate?

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Re: Anyone see the CBS News on another decline in Savings rate?
Old 07-31-2006, 08:13 PM   #3
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Re: Anyone see the CBS News on another decline in Savings rate?

Wonder why. I know for a fact we are saving more.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 07-31-2006, 10:28 PM   #4
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Re: Anyone see the CBS News on another decline in Savings rate?

A friend of mine recently purchased a condo a few months ago, and recently told me that he's not quite making it each month. He is the statistic. I gave him some tips on how I save money on my bills, but who knows- I guess budgeting and planning ahead to see if you can afford something as expensive as a condo is passť.

Mwsinron- you're posting here. You're in the minority.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 07:32 AM   #5
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Re: Anyone see the CBS News on another decline in Savings rate?

8:30 AM ET 8/1/06 U.S. JUNE PERSONAL SAVINGS RATE -1.5% :P
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 07:44 AM   #6
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Re: Anyone see the CBS News on another decline in Savings rate?

One thing I noticed when returning to the states on business is that there is a great push by companies to push their products on the consumer. By travelling back and forth between Panama and the US I really notice the drive to consume and keep up with the Jones' mentality. Everyone must have the latest toy or gadget. While that in itself is not a problem, an over indulgant of it is not economically healthy. Folks on this site really are the minority when it comes to consuming products. The average person really needs to differentiate between a want and a need. You don't need the newest IPOD or whatever the new fad is now.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 07:44 AM   #7
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Re: Anyone see the CBS News on another decline in Savings rate?

WASHINGTON (AP) -- Consumer spending was weak for a fourth straight month in June as rising gasoline prices left Americans with little to spend on other items. A key measure of inflation rose at the fastest pace in more than a decade.

http://biz.yahoo.com/ap/060801/economy.html?.v=4
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 07:47 AM   #8
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Re: Anyone see the CBS News on another decline in Savings rate?

Quote:
Originally Posted by Arif
By travelling back and forth between Panama and the US I really notice the drive to consume and keep up with the Jones' mentality.
I own 880 acres by La Chorrerra.

And I am seeing exactly what you are seeing. People going to "shop" just for something to do in the U.S.



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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 07:53 AM   #9
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Re: Anyone see the CBS News on another decline in Savings rate?

Quote:
Originally Posted by IHateCNBC
8:30 AM ET 8/1/06 U.S. JUNE PERSONAL SAVINGS RATE -1.5% :P
Quote:
Originally Posted by IHateCNBC
8/1/06 U.S. CORE INFLATION RATE MATCHES AN 11-YEAR HIGH :P
Quote:
Originally Posted by IHateCNBC
WASHINGTON (AP) -- Consumer spending was weak for a fourth straight month in June as rising gasoline prices left Americans with little to spend on other items. A key measure of inflation rose at the fastest pace in more than a decade.

http://biz.yahoo.com/ap/060801/economy.html?.v=4
Now I understand why you chose the name "IHateCNBC". No one likes their competitor!

PS: You can make those headlines crawl, you know....
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 07:56 AM   #10
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Re: Anyone see the CBS News on another decline in Savings rate?

Quote:
Originally Posted by REWahoo!
Now I understand why you chose the name "IHateCNBC".* No one likes their competitor!

PS: You can make those headlines crawl, you know....

I only posted that because Cut Throat talked about the evening news story he watched about people not saving anymore.* *

Sorry.* I will go back to lurking.* *
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 08:00 AM   #11
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Re: Anyone see the CBS News on another decline in Savings rate?

Is this another one of those instances where if you're putting money into a 401k or investing in stocks or mutual funds, or paying down your mortgage ahead of time, or perhaps even putting it into CD's, that they don't count it as savings?

I've heard that when you take those other forms of "savings" into account, the picture isn't nearly so bleak. Sure, there are still plenty of people in dire straights, but I still don't think overall things are as bad as some of these scare-tactic articles would lead us to believe.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 08:04 AM   #12
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Re: Anyone see the CBS News on another decline in Savings rate?

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Originally Posted by Andre1969
Is this another one of those instances where if you're putting money into a 401k or investing in stocks or mutual funds, or paying down your mortgage ahead of time, or perhaps even putting it into CD's, that they don't count it as savings?

I've heard that when you take those other forms of "savings" into account, the picture isn't nearly so bleak.* Sure, there are still plenty of people in dire straights, but I still don't think overall things are as bad as some of these scare-tactic articles would lead us to believe.
If that graph above is true. Whats with the change in the last few quaters? Rising fuel costs? Interesting data to me. What would cause such a 360 change.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 08:33 AM   #13
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Re: Anyone see the CBS News on another decline in Savings rate?

maybe a combination of rising fuel costs (not just gasoline but home heating oil and natural gas...and electricity is currently on the rise), plus rising interest rates? I have an HELOC, and it was late last year I think when the rate started to really go up noticeably.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 08:38 AM   #14
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Re: Anyone see the CBS News on another decline in Savings rate?

Quote:
Originally Posted by Andre1969
Is this another one of those instances where if you're putting money into a 401k or investing in stocks or mutual funds, or paying down your mortgage ahead of time, or perhaps even putting it into CD's, that they don't count it as savings?

I've heard that when you take those other forms of "savings" into account, the picture isn't nearly so bleak. Sure, there are still plenty of people in dire straights, but I still don't think overall things are as bad as some of these scare-tactic articles would lead us to believe.
Yeah, I thought we'd pretty much beat up this statistic earlier this year, that it wasn't crdible because all it counted as savings was checking accounts and bank savings account or somesuch limited notions. Some posters at the time rose in defense of this accounting method, saying, in effect, 'if the price can fluctuate, it ain't savings-- savings is cash, period."

If that is in fact how the govt reports savings, I think we can ignore this whole topic. Anybody know for sure? And has anyone seen stats on modified savings rates that would report new money coming into all the various places people actually store it? I did a little digging into the Fed's Survey of Consumer Finances earlier this year and found that, over the previous 3 years (2002, 2003, 2004) financial net worth was up pretty nicely for a large swath of the population.
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 01:49 PM   #15
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Re: Anyone see the CBS News on another decline in Savings rate?

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Yeah, I thought we'd pretty much beat up this statistic earlier this year, that it wasn't crdible because all it counted as savings was checking accounts and bank savings account or somesuch limited notions.* Some posters at the time rose in defense of this accounting method, saying, in effect, 'if the price can fluctuate, it ain't savings-- savings is cash, period."*

If that is in fact how the govt reports savings, I think we can ignore this whole topic.* Anybody know for sure?* And has anyone seen stats on modified savings rates that would report new money coming into all the various places people actually store it?* I did a little digging into the Fed's Survey of Consumer Finances earlier this year and found that, over the previous 3 years (2002, 2003, 2004) financial net worth was up pretty nicely for a large swath of the population.
The personal savings rate is basically income - expenses.* But, they exclude "asset purchases" (like homes) as expenses.* *And they exclude capital gains, pension income, and retirement savings account withdrawals from income.

So, you would expect the savings rate to decrease as more people retire.* *But it has been decreasing since about 1982, well before the boomers retired.

So, somebody tried to separate the savings rate of retirees (which is strongly negative) from working stiffs, and they showed that workers saved about 4.4% of their income at a time when the BEA's number was 1.8%.* *That's the good news.

The bad news is that virtually all of the savings from 1980 forward is in the form of pension plans, and since 1990 workers savings outside of pension plans has been negative.

Article
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 09:38 PM   #16
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Re: Anyone see the CBS News on another decline in Savings rate?

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I own 880 acres by La Chorrerra.
Nice area and a LOT of land! We are in the process of buying a lot in Costa Esmarelda near Coronado. Just 1300 sq mtrs though: http://early-retirement.org/forums/i...p?topic=8831.0
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 11:30 PM   #17
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Re: Anyone see the CBS News on another decline in Savings rate?

Wab,
So what you're saying is that there are two ways to calculate Savings -- one is to do surveys of personal finance -- income less expenses, and extrapolate from there. (with the nuances for retirees, working people).

The other is to actually go count the amount of money in savings and checking accounts as a percentage of national income or disposable income or somesuch macroeconomic number.

Maybe it was the latter that we were dusting up in earlier posts. The household approach seems to make more sense if the polls are done right.

Still, when we see these stats in the press, is it generally possible to figure out which approach they are talking about for any given set of stats? (I see the link to an article at the bottom of your last post and will go check it out next)
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-01-2006, 11:43 PM   #18
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Re: Anyone see the CBS News on another decline in Savings rate?

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Originally Posted by ESRBob
The other is to actually go count the amount of money in savings* and checking accounts as a percentage of national income or disposable income or somesuch macroeconomic number.
Well, I'm sure there are a bunch of ways, but the number the press usually reports comes from the BEA. They don't look at checking accounts (or they wouldn't find a negative number). They just look at income - expenditures.

The problem a lot of people have with the BEA number is that they don't consider cap gains as income, even *realized* cap gains, which I think we all normally view as "income."
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Re: Anyone see the CBS News on another decline in Savings rate?
Old 08-02-2006, 07:29 AM   #19
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Re: Anyone see the CBS News on another decline in Savings rate?

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Originally Posted by IHateCNBC
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Better clean that pine straw off your roof or it will really clog up your rain gutters.

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