Latest American Poverty Rate

Highest in Decades

The American dream has been a driving ideal for those born here, and for immigrants seeking a better way of life. Along with this sentiment is a common vision, of this better way of life – a beautiful three-bedroom house, with an emerald green lawn, white picket fence, and friendly recipe-sharing neighbors. Perhaps the dream has had some new additions or modifications such as having a larger apartment within a bustling city, and a room with a view. All in all, it adds up to a want for the most desirable contemporary life experience.

The Associated Press has released information from a Census Bureau report regarding a study conducted in 2010.  It states that almost one out of every six Americans is living in poverty. That is a huge amount of people: over 45 million Americans are. This is up by .8% from 2009.

The reasoning for such increasing numbers is the lack of jobs in America today. As I have reported recently, the unemployment rate in the US is rising at an exponential rate. According to the report, the last three years have had the highest increase rate from any three-year timeline since the ‘80s, and the highest amount of Americans living in poverty since the late ‘50s.

For these reasons a lot more Americans have had to rely on social services such as welfare, and food stamps. Reuters has reported the same amount of people on food stamps – 15%. Up “74% from 2007, just before the financial crisis and a deep recession led to mass job losses.” However, some of those receiving these food stamp benefits may be working as the underemployed. These are astonishing numbers – absolutely incredible.

Hopefully, Obama’s job plan will be acceptable and get Americans back to work. Economists are fully behind his plan. However, some are still reluctant to change financial “growth forecasts” for the remainder of this year, and going into the next. Predictions are still being “trimmed at a percentage point,” according to reports (AP). The US needs to produce about one-quarter million jobs on a monthly basis, to even begin to combat the high unemployment rate. A “rapid” job creation increase is what Americans need, according to the same report. Without that, we may continue at the currently over 9% unemployment rate.

At any rate, we need something extremely positive to happen quite quickly.

The census has determined that those living on less than approximately “$22,314” for a household of four, and less than “$11,139” for any one person are considered to be living in poverty.

The statue of liberty has a greeting meant for all that have chosen to live here. It states: “give me your tired, your poor, your huddled masses yearning to breathe free.  The wretched refuse of your teeming shore.  Send these, the homeless, the tempest-tost to me, I lift my lamp beside the golden door!” Now it seems that we are the tired, the poor, and “huddled masses yearning to breath free…”

Resources:

Associated Press: http://www.ap.org

Reuters: http://www.reuters.com

The Statue of Liberty – Ellis Island Foundation, Inc.: http://www.statueofliberty.org

Yahoo! News – The Lookout: http://www.finance.yahoo.com

What to do when you can’t Pay your Bills

Avoiding collection calls won’t get them off your back. You have to take action when you can’t pay your bills. Too often, the lenders are seen as the enemy but they are really just trying to get what is due to them. Of course they should be treating you with respect when you talk to them on the phone. Being late on bills isn’t just cause for them to harass you.

If you can’t pay your bills on time, contact who you owe and let them know. They may be able to have you pay an interest only payment for a few months. You won’t pay anything on principal. Then they will tack those payments on to the very end of your loan. They may be able to reduce your payment as well into smaller amounts, but you will have to pay for it over a longer period of time.
Still, being able to get your debts reduced can ease the monthly burden of what you have to pay out. As your circumstances improve, you can start to pay more to the lenders once again. If you owe a large amount of money, you may be able to get a lump sum settlement. This will pay off what you owe and then you can be free and clear from it.

When you accept such a settlement, make sure you get something in writing that verifies what the agreement will be. That way you have some proof should the attempt to come after you again in the future for the remaining balance.

You want to do all you can to avoid your bills going to collection agencies. When that happens you may have to pay legal fees and fines on top of what you already owe. This will only compound the problems that you have. When creditors don’t hear from you, they will assume that you don’t care. They may freeze your bank account or they can garnish your wages to get what you owe to them.

There are plenty of debt consolidation companies out there, but you do have to be careful. Many of them charge high fees and that is money that could be going to pay down your debt. They can negotiate balances, but you should be able to do that on your own with many creditors.

You may find that consolidating your debt though is a good idea. You will want to carefully evaluate the overall cost of it. If the rate of interest will be low enough, it could save you a large sum of money. You may find that getting a home equity loan can help you to pay off your debts. Then you can start over with a clean slate and have peace of mind. You don’t want to worry every time your phone rings that it is someone trying to get you to pay a bill.

Oil Prices are Down

Linked With Resignation of European Executive

America has been feeling the pinch of rising oil and gas costs in recent months. Political embargos or work stoppage with oil rich countries have served as a catalyst for this trend. For the first time, in a long time, oil prices are down and we can expect to get bit of a break. The reason why may surprise you.

Resignation Domination

Juergen Stark, a top Economist at the European Central Bank, has handed in his resignation according to a report by the Associated Press: Stark will be finishing out his term early. This news has inspired the price of oil to go down as doubts about Europe’s debt crisis increases. Although Stark’s exit has been noted in the article for “personal reasons,” it is believed that there may be a connection to a growing divide among European officials. These ideas seem to have taken to the wind and traveling far enough to make people fear that this change may be an indication of Europe becoming overwhelmed – furthering financial demise in Europe. If European officials cannot agree on what to do about their own issues, the world becomes very nervous and a global chain reaction begins.

How Low

It has also been reported that oil is down by 2%: approximately $.30 cents in New York and $1.30 in the UK.

Reasons for Concern

Europe is a huge consumer of oil. Without a stable European debt recovery plan in place, a trend of low usage will manifest itself. There will be no real way to know if Europe will be able to afford the same supply of oil – or other merchandise, for that matter. This will have a direct effect on the price and distribution of oil, as well as on how Europeans travel. Changes in this behavior could certainly be detrimental to American tourism.

The prices went down due to an anticipated lack of demand, according to experts. This includes heating oil as well. However, it has been reported that the U.S. supply of oil has decreased dramatically because of an increase in demand, recently. Of course this has to be related to the recent storms as well. These were a hindrance to transporting oil, as well as causing a spike in demand, for that particular time. It seems that more oil is on the way from Libya, after a stoppage of over 200 days. However, the amount being sent is hardly enough to keep American consumers satisfied for long, unfortunately.

What Else is Being Affected?

What else is not being affected is probably a better question. As it stands, stocks have been going down and the Dow fell to a significant low at close on Friday as a result. Experts have stated that they expect for stocks to fall even further – possibly pushing America into a deeper recession.

This news is quite startling. According to the experts, Stark’s separation is being seen by some as a telltale sign of worse days to come.

Hope in Sight

If Obama’s job plan actually takes flight, there may be a chance for a trickle effect recovery. Many economists are on his side and believe his bill makes perfect sense and truly will work. It is now up to congress to bring the bill into being. This will pump new life into the American economy. It is believed that this opportunity for rejuvenation will be a promising start for all of us.

Resources:

Associated Press: http://www.ap.org

Canadian Press: http://www.thecanadianpress.com

Yahoo! News: http://www.ca.finance.yahoo.com

American Jobs

Where Are They Now?

As Labor Day passes, this question is quite a glaring one. Unemployment is a big concern for the majority of Americans today: 9.1 % of Americans are currently without jobs.

Nevertheless, when the numbers of the Americans that are underemployed, along with those who have stopped looking for work, and those that are still looking for work (unemployed), are combined the figure comes out to be over 16%.

The Bureau of Labor Statistics released a report on September 2 noting that there has been a “next to zero,” increase in jobs creation – approximately 62,000 – and exclusively within the private sector within the month of August. However a conflicting expert interpretation within the Associated Press has stated that the government report has noted no new jobs have been “added” and no hiring for existing jobs have occurred. It would seem that jobs created within the private sector, although noted, do not make enough of an effect to be taken seriously. This is quite bleak, to say the least.

There have been some unusual circumstances that may be considered to be contributing factors that may have discouraged higher numbers such as the earthquake along the American East Coast at the beginning of August and the hurricane during the end. These are conditions that are hardly welcoming of anything more than people going into basic survival mode. Perhaps without these happenings, the numbers would have been better.

Experts had previously projected an increase of 93,000 jobs created for August 2011.

When the unemployment rate starts to decrease it will likely be quite minimal and slow, as the first thing employers are expected to do will be to increase the number of hours allotted to the now underemployed class – making them full-time workers. The rate will also stay high because the people that were previously not looking for work, and not counted as unemployed, will start looking for work when more jobs are added, and it is as that time that they will be considered to be unemployed – officially.

Income Supplements – How Some Americans are Surviving

Food stamps, food banks, and other social services are at an all time high and not exclusive to the unemployed. The underemployed, or low wage earners are now utilizing the government program in higher numbers than ever before.

15% of Americans are currently using food stamps as a supplement and only 60% of them are unemployed. Experts have stated that the number of households that will need to rely on food stamps will increase because the majority of new jobs being created are low wage positions as well the increasing number of Americans with expired unemployment benefits.

Psychological Impact

The unemployed are now sleeping more and working for less or for free according to a recent study by a Princeton University Economic expert.

As the amount of jobs being offered has decreased, along with a high rejection rate, a lot of the unemployed have stopped looking as intensely or at all. The time of sleeping in the morning hours has increased, as well as napping throughout the day. Those that are active are spending more time with children, doing more chores around the house, or participating in volunteer work. This has been a huge distraction for looking for work for wages. Employers are now reluctant to hire those that have been out of work for long periods of time because an assumed aloofness associated with staying out of work for an increased amount of time.

Both the unemployed and their potential employers are being psychologically impacted to a point that is proving to be an impediment to searching for a job, job creation, and new hiring.

Resources:

Associated Press: http://www.ap.org

Contrary Indicator: http://www.finance.yahoo.com

Financially Fit: http://www.financiallyfit.yahoo.com

Reuters: http://www.reuters.com

The Lookout: http://www.news.yahoo.com

Teaching Teenagers the Value of Money

Teenagers seem to have an endless need for money. Many of them also have a hard time distinguishing between needs and wants. When my son got a summer job at a local fast food restaurant, I thought it was great. I figured he would have some spending money and gas money.

Yet it seemed his was spending his paycheck faster than he earned it. He was borrowing money from me for gas. I also found out he was asking his younger brother for money to get him from one payday to the next. I found this very hard to understand for a teenager with no bills – making $450 every two weeks!

I figured it was time to sit him down and teach him the value of money. I certainly didn’t want to think about him out there on his own in a year or two with the same passive thoughts about money. I chose a time when we were both able to focus on the issue, and explained my concerns.

I had my son explain to me what he thought were wants and needs. To him, needs were new sunglasses, taking his girlfriend to the movie, etc. I quickly explained to him those were all wants and not needs or necessities.

I explained to my son that when he got his next paycheck, he would pay me back for the money he borrowed and his brother. I told him it was no longer going to be an option to borrow money to get by.

When he got paid, I had him take 10% of it and put it into an envelope for savings. He wasn’t happy with it, but I wanted him to get into that habit. I had the thought he should save more than that, but baby steps is what we were doing right now.

I also gave him an envelope to put $40 in it for gas money to last him for two weeks. He said that he usually spends more than that, going back and forth here and there. So I made him put another $20 in that envelope.

We then talked about what he had planned for the month. For each item, we put money into an envelope. For example dinner and a movie with his girlfriend that following weekend. He was also going camping with friends for a few days and needed to buy a couple of things.

What he saw before him was how much money he had left to work with. It was about $70 which isn’t bad for things for a teenager for 2 weeks. We also went over what he often spends his money on. We identified the $8 or so he was spending a day on fast food to eat with friends was a waste of money.

Now he has money to get from one payday to the next. He understands that he doesn’t have to rush out and spend every cent as soon as he earns it. We still have a long way to go, but it is a step in the right direction!

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