MONEY OBEDIENCE

Responsible consumption is the new normal

Personal finance bloggers should be cheering. Most of them, us included, write about using credit cards responsibly if using them at all. I am sure that personal finance bloggers are not only part of the new fashion but have also influenced the new fashion: credit card use is down as “only” 62 million people have credit cards now which is 8 million fewer people than a year ago.

Some of these people have had their credit cards canceled by their banks, but a good many people have willingly given up their credit cards. This is big, especially now that the gift-giving holidays are coming up. You all know that the day after Thanksgiving is a huge shopping day because many people have the day off and use it to get a jump on their holiday shopping. Stores entice shoppers by offering big sale discounts. Well, all reports are that Black Friday this year was successful, with stores reporting more sales than for Black Friday last year. And you internet-savvy readers know that there are big sales online the Monday after Thanksgiving, right? Cyber Monday has also turned out to show increasing online sales of almost 20% over last year, much better than expected. The US is known as a society based on consumption for nothing, right? We are not going to give up that distinction anytime soon. Consumption still rules.

Interestingly, The New York Times quoted a couple of shoppers on Black Friday who chose not to use credit cards! These shoppers are still out there and shopping. They are just paying for purchases by using cash, or a debit card, instead.

Increased sales combined with lower credit card use tell me that we as a country are turning the corner towards more responsible consumption. This is just as well. There is nothing wrong with spending your hard-earned money whichever way you want. It is a free country. Trouble comes from spending somebody else’s money through credit cards, cash-out mortgages, and other consumption shenanigans that help you to dig yourself into a big hole of debt that can be hard to climb out of.

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Posted in Budget and Expenses