"Rice and Beans, Beans and Rice". These are not my words, but the ones I repeat to myself on a regular basis. Anyone who wonders why we are in the financial crisis we are today just needs to listen to the Dave Ramsey radio show.
Caught somewhere between the "Have's" and the "Have Not's" are the "Wanna Be's" and being a loyal listener, I'd venture to say there are a lot of them out there. Living beyond their means, and wondering how are the ever going to pay for it.
It's frightening that the concept of buying only things you could afford is not practiced by a large majority of society. Credit cards made it too easy to consume material things today with the promise to pay for them...eventually. Basically, we borrow and consume based on our future earnings, not our current realities. Call it optimism or denial, but we spend as if we are guaranteed to always have work and that we will always make more and more money.
Take the real estate slump as an example. Consumers were approved and purchased homes at the top end of their budget. The loans required little or no money down; and everyone jumped on board. Then homeowners were able to lverage their homes and "borrow" money today, based on tomorrow's (estimated) value. No downpayment, no significant repayment of principal, no actual equity in the home. This is our reality, and it hurts.
The wake-up call has been heard loud and clear. There is a new era of responsibility and it starts today. Consume less, eat "rice and beans, beans and rice", pay off debts, and save for a rainy day. In the long run, it's a commitment worth making.