The Financial Literacy Crisis Will Come to Pass

It has often been said that we have a financial literacy crisis here in the United States. You can ask any high school teacher about economics classes, and you will find that most likely economics are not taught in high school anymore unless you are in the advanced placement classes. This is a travesty. Home economics is something that is very important, and in these classes students learn how to balance a checkbook. But many people don't take home economics classes.

Still, the financial literacy crisis in the United States will come to pass, just like it did during the Depression. People were forced to save, cut back on expenses, and budget better. Indeed, that is what is happening right now. Likewise, credit card companies have cut back on balances, and are forcing customers to pay them off quicker. Banks have also cut down on people's lines of credit, and consumers are seeing that they have no safety net, so they must save.

Right now, America's savings rate is sitting at about 10% which is higher than it has been in the last four decades. What is happening is people are starting to realize that money doesn't grow on trees, but you can't have something for nothing, and no one is entitled automatically to everything that the neighbors have without working for it, paying for it, and saving so that they can afford it.

One thing that this financial crisis has taught people is that there is no free lunch and real estate prices will not go up forever, and you cannot keep borrowing against the equity. They have also learned that the stock market will not go up forever all the time, and that they need to make more money and save more money if they are to survive the ups and downs of the normal business cycle. Perhaps this financial crisis has been a good thing for the American consumer. Please consider all this.

Lance Winslow is a retired franchisor - Lance Winslow's Bio. Lance Winslow is formerly the CEO of WashGuys family of franchises for instance one of Lance Winslow's favorite companies on the team; http://www.windowwashguys.com/links.shtml/.

Article Source: http://EzineArticles.com/?expert=Lance_Winslow