Last month, we published an article about the top financial worries of Americans. According to the data we gathered from the survey results of the National Foundation for Credit Counseling (NFCC), Americans worried about insufficient funds.
We all know that not having enough money to spend on your needs is really a serious problem. When you are unable to pay for your needs, it is not only you that has a problem. When you have a tight budget, you get to depend on the government who has to get funding to help you elsewhere. The budget for food stamps, for instance, will have to be taken from the budget of the military or the pension of the elderly. It can also be imposed on workers as the government tries to increase their income to cover all the expenses needed to help Americans who cannot afford to cover their own expenses.
It is all pretty involved and it shows us a never ending cycle of financial problems in the country. It is important that we identify what these problems are because it will help us understand our own personal financial struggles.
What are the top money difficulties of Americans
While the NFCC reported that insufficient funds worried consumers, Gallup.com came up with a list of the financial problems that are running along the same lines as the other report. Apparently, the top financial troubles are lack of money/low wages (13%), health care costs (12%), and college expenses/loans (11%).
The report even broke it down into different ages since the money difficulties of consumers vary per age. Here is the top three monetary problems of the average American consumer per age bracket.
- 18 – 29 years old: College expenses/loans (21%), Lack of money/low wages (15%), and Housing (14%)
- 30 – 49 years old: College expenses/loans (14%), Lack of money/low wages (14%), and Healthcare (13%)
- 50 – 64 years old: Healthcare (15%), Bills/credit cards/debt (14%), and Lack of money/low wages (12%)
- 65 years and older: Healthcare (15%), Lack of money/low wages (13%), and Cost of living/inflation (12%)
As you can see, the financial problems of consumers will change with age. This has probably something to do with the changing priorities of consumers as they age. For instance, a retired individual will be concerned about making sure that their money will outlive them in retirement. This can explain why the cost of living is among the top three concerns. For the young adults, coming out of college would naturally make their student loans the top concern. That is because they have yet to find job security that will make them feel more confident about meeting their monthly payments.
How can you avoid the top three financial worries
Now that you have identified the financial problems that is gripping the American population, let us determine how we can rise above these difficulties. This is when financial education will come into play. By learning about the problem, we can easily solve them and make sure that the same problems will not trouble us anymore. Let us concentrate on the top three financial troubles in the country.
Lack of money/low wages
Even with the NFCC data, this is a notable concern already. When you look at the data from Gallup, they have listed the top financial problems in the past 3 years and this consistently reigned at the number 1 spot. To deal with the low wages, President Barack Obama raised the federal minimum wages and encouraged the other states to impose the same rule to force private corporations to follow suit. Based on the information published by National Conference of State Legislatures on their site, NCSL.org, most of the states in the country are considering the wage hike. But the question is, will raising the minimum wage answer our problems?
That depends on how we will react to the increase. You see, the problem with some of us is that we tend to associate our spending with our income. We spend based on what we can afford and not on what we really need to survive. If you flip it the other way and concentrate on what you need, regardless of how much you earn, your spending will remain the same. Any increase in income will really be beneficial because it will go to an expense that matters most – our savings fund.
The second of the financial problems involve health care costs. This is tricky because it involves a whole industry that we may have to revamp. Sure, the government have the Obamacare in place. And of course, we have the existing Medicare and Medicaid to help out in the health care expenses. But the thing is, we need to stop asking our government to bail us out. Instead of giving us money to pay for the rising cost of medical care, they should find a way to regulate the prices to keep it from being too expensive in the first place.
As for our part, we need to seriously start taking care of ourselves. Our country is so hooked on fast food restaurants and processed food. This is our preference because it makes meal preparation convenient. That has got to stop. Convenience is great but not to the extent that we do not move our bodies anymore. We are not meant to be pampered. We are meant to move so our bodies will not deteriorate. Prevention is better than cure so live a healthy lifestyle and you will find this financial trouble to be gone.
The last of the financial problems is all about college debt. When you think about it, the reason why student loans are quite scary is the fact that people perceive it to be a necessary debt to have. It is often equated with getting a college education. According to PEWSocialTrends.org, despite the fact that the rising cost education puts most students in debt, graduates admit that college actually paid off. If you look at other research and reports, it is evident that college graduates are more well off financially because of their educational attainment.
But here’s where you need to make revisions about your mindset. All the study shows that a college education is needed to be financially successful in life. But it did not say that student loans need to be a part of that. There are so many options to get an education without putting yourself through debt. And if you really have to, you need to be careful about the amount that you will loan. You do not need to borrow $100,000 just to have a career that pays you $40,000 a year. How can you possibly get out of that much debt with what you are earning? You need to educate yourself about how you will approach student loans if you really need it to get a degree. If you have time, just save up for it. Make the sacrifices while in school so you do not have to make more sacrifices once you graduate.
In the end, all of these financial problems can be solved by being frugal and wise about where your money should go. Believe it or not, you may think that your finances is getting out of hand but that does not have to be the case. You are more in control of your money than you think. If you put your mind into saving money so you do not have to worry about any of the troubles mentioned above, you can motivate yourself to do just that.