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Personal Financial Responsibility for National Financial Well-being

28 November 2017, 13:36 CET

Around the world, overuse of consumer credit and out-of-control debt are weighing down societies in ways that are easy to see.

For the purposes of this post, we'll use the United States as an example. The US is much different than any nation in the EU. Its area is vast, its population is diverse, and its various cultures can't seem to agree on much of anything.

However, one area where Americans seem (at least at face value) to be unified is on the subject of consumer debt. The average American dies with $62,000 in debt. Not everyone has this much death when they expire, of course, and many Americans have a great deal of wealth and no debt at all. But all this means is that many Americans have far more than $62,000 when they pass away. Not only is this difficult for their families, and for their own lives before death, it's also unsustainable for the society at large. The impact of debt culture is seen in many places in the United States, and these situations are cropping up more frequently in the EU, or are at least threatening to do so.

The Widespread Effects of Debt Culture

Living in the EU, you may be unaware of many of the details of what it means to be an American in 2017. But no doubt, you've found some of this information in headlines read on the top personal finance blogs or from other sources. Some of these are obvious, others less so.

  • Financial Dependence: Financial independence in the dream of many, but financial dependence is the state that necessarily precedes it. The American middle class has always existed in the "Sweet spot" between independence and dependence, gaining wealth over time and feeding back into the communities in which they grew up. But the American middle class is shrinking, and more citizens are depending upon credit card debt and government aid than ever before. Personal financial responsibility isn't the only answer to this question, but the lack of personal finance education as standard school curriculum helps create a culture of financial ignorance, in which debt is the norm and in which outside support must be created for individuals who could be capable of being more independent than they actually are.
  • Addiction and Instability: America's ongoing opioid epidemic is no longer considered by most to be a widespread case of moral failure. Instead it is being cast as a public health crisis, one in which finances are heavily involved. The opioid epidemic crosses all income and demographic boundaries, but it statistically falls on the poor more often than the rich. Opioid addiction is often found in areas where jobs have been lost, where wages have stagnated or declined, and where populations are shrinking. Often a drug of despair, heroin and its analogues are often seen as a last resort for desperate people, to whom life has not been kind. Financial stability is not the common denominator in every case of ongoing illicit opiate use, but it is one so common that it cannot be ignored.

There are many other symptoms of financial crisis in the life of the average American, including disease, mental illness, lack of education, shortened life expectancy, and regional cultural decline. There is more to life than money, but life can't be lived without it for almost anyone. To be able to manage one's own money is an important aspect of being a responsible and independent adult, a state of being that more and more Americans are finding it difficult to attain. Financial education is far from the only answer, but it can provide some of the skills necessary to fight back against prevailing social ills like debt and addiction.

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