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Home » Business And Finance Articles » New Year Resolutions Some Startling Statistics About American Consumers

New Year Resolutions: Some Startling Statistics About American Consumers

Before you whip out your credit card, stop and think. America is often called a consumer society, and it's true. We're also a nation of credit card debt, which is evidenced by some of these startling facts.

We all know that acquiring overwhelming debt is stressful from a financial standpoint. However, it might surprise you to know that more than 70 percent of divorces in America are brought about due to financial problems.

One thing Americans are NOT is savers. We simply don't put away enough money to protect us in the case of financial emergency. In fact, the average American consumer carries so much debt load that they're a mere three paychecks away from having to declare bankruptcy.

Financial emergencies arise all the time, of course, but Americans continue to build up credit card debt, without thought of the possible consequences. That's why nearly 1,500,000 people in the United States are forced to file for bankruptcy every year. Another 1,500,000 people will turn to the various consumer credit counseling organizations for help in order to try to avert bankruptcy. That's a staggering number, but it's dwarfed in comparison to the 37,000,000 people who endeavor to work out plans with their creditors on their own. That's 40 million people a year who are in enough financial trouble to take drastic action!

How do people get in such horrible financial condition? One way is through the use of credit cards. They may be convenient, but they certainly make consumers pay more for the merchandise they buy. For instance, a person paying for a purchase with a credit card will pay, on average, more than 130 percent for that item than if they had simply paid cash for it.

A large majority of consumer only pay the minimum payment on their charge cards, but those payments are generally 90 percent interest, with only 10 percent going toward reducing the principal. A staggering 71% of all credit card holders pay only the minimum payment, and they do it without a thought to the consequences. If they can easily afford the monthly payment, they just keep paying it, without realizing how expensive their purchases ultimately have become.

If you are one of the millions of Americans who are only paying the minimum amount on your charge cards, start paying MORE each month. Even if it's only a little more. Reducing the principal balance will shorten your overall payment schedule--sometimes by hundreds or even thousands of dollars.

The statistics are mind-boggling, and with interest rates headed even higher, you must educate yourself on the wise use of credit, pay cash whenever possible, and try to live within your means, even if it means doing without some things. It's the only way you can avoid becoming one of those sad financial statistics yourself. Include monitoring your credit card use in your New Year's Resolutions.

Copyright © Jeanette J. Fisher

And here is another random article you might be interested in...

Are You Taking Care of Business?

Too often, when we say we are "taking care of business", we think about the paperwork, the accounting, the inventory, etc... the trivial things that are important to get done in order for our business to run smoothly and efficiently. While necessary, they are not the most important.

We need to change our thinking about what "taking care of business" means. We need to make sales in order to have a profitable business, and we know without our customers or consultants, we don't have a business. They are our lifeblood, they are what keeps us moving forward, and meeting their needs should be our primary mission.

Without consultants or customers, there are no sales. Without sales, there is no revenue... without revenue, there is no business and we might as well go back and get a j.o.b. It is crucial that we take care of our customers and consultants. CRM (customer-relationship management) is a buzz-word in "big business". Many large corporations have implemented systems and technology to supposedly create customer care. Some have been successful, many have not.

Most of these systems simply give the illusion of customer care, but have failed miserably in actually providing it.

How many times have you been through the "round robin" of "press 1 for this" and "press 2 for that", only to spend an hour or more and never actually speak to a live person or get your problem solved? You hang up in the phone in frustration and vow never to spend money with XYZ Company again. This approach to customer care continues to baffle me as to why large companies believe this is effective. How can they possibly think that customer relationships can be created and nurtured by a recording?

Are those who make these decisions that far removed up the "corporate ladder" they can't see this isn't customer care at all and having the opposite effect?

Each and every one of our customers and consultants should be made to feel like they are our most important one. If we don't take care of them, someone or some other company will. Small and home businesses have an incredible opportunity to take back customer care and relationships the way it is supposed to be. We are in an incredible position to "take care of business".

Technology is wonderful. Without technology, there would be no internet and many of us would not be in business. However, there is no technology on this earth that can replace human connections. Technology will never replace our customers knowing that there is someone who truly cares about their needs.

So, how about you? Are you taking care of business?