The P.A.

A weekly address from Patrick Adams,
President of St. Louis Community Credit Union

It’s OK to Save!

On December 22nd, 2008, posted in: Uncategorized by

Recently, I read a Wall Street Journal article that expressed concern over the fact that consumers were spending less and saving more. The article was framed in the context that because the engine of our economy is fueled by consumer spending, we (being you and me) should be spending our money at a more brisk clip. In other words, the more we spend, the better off the economy will be. True enough, but…

Question…didn’t we end up in the economic turmoil we’re in today because (in part) we spent more than we could afford? Hmmmm. Didn’t housing values balloon out of control because of our willingness to spend, spend, spend? Generally speaking, the consumer’s appetite for spending has been gluttonous. Maybe shifting down a gear and saving a few bucks isn’t all that bad of an idea.

We regularly encounter people that have no safety net. Life happens, and suddenly they are paralyzed by anxiety and fear without that “rainy day” savings account to help them over the hump. The 48-inch, “high-def,” flat screen TV that is still being paid for on a monthly credit card bill doesn’t do you much good when three tires are bald and the other one’s flat. Now what? A little savings might help at such a critical time.

The average consumer’s debt load is so high that people are playing Russian roulette with their bills. The result is that consumers everywhere are shooting holes in their credit score and hurting their standard of living every single day.

Yes, we make loans to qualified candidates. However, credit unions were formed in this country 100 years ago to promote thrift, i.e. savings. We still believe in savings. That’s why St. Louis Community’s savings rates are some of the best in town, and encourage regular, disciplined savings activity.

Save a little more than in the past, spend within your means, and have a sound budget and financial plan for the future. If you do those things, believe me, the economy will be just fine.

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