Scanning the Business Section of my local paper today, I came across a syndicated column by financial writer, Gail MarksJarvis of the Chicago Tribune. She had me at the first paragraph:
“After living through one of the most brutal recessions in U.S. history, many late teens and young adults could be scarred for life, adopting behaviors that could skew everything from their own careers to politics, corporate profits and the stock market.”
She goes on to say that this recession may have the same kind of effect on our young Americans today that the Great Depression had on the youth of the 1930’s, which resulted in them being conservative spenders and investors, and being loyal employees less likely to jump from job to job in exchange for the security of a steady job.
Perhaps a few scars are a good thing. A little pain can bring about growth, or at least teach one some lessons in pain avoidance.
The youngsters of the 1930’s set the tone of the prosperity of the 1950’s. The economy grew slowly, but steadily. There were no huge bubbles, but also no big crashes. People only bought what they could afford to buy. Defaulting on a loan or credit card was rare, because credit was usually only extended to people likely to pay it back. There was not the sense of entitlement in people that we see now; people took pride in earning what they owned.
Of course, since most things in life are cyclical, these thrifty parents raised a bunch of baby boomers that were used to having material comfort and security. They grew to expect it. They got themselves into debt, learned how to play the bankruptcy game, and expected the government or others to bail them out when they ran into hard times…even when they caused those hard times through their own recklessness.
I sometimes think I’m a reincarnated soul from the 1930’s. I don’t share the cavalier attitude about money and things that a lot of people my age exhibit. I’ve always felt better putting money in the bank than I did spending it. We use credit cards for the convenience and perks, but always pay the balance in full each month to avoid finance charges. (The exception was when we first got married and we paid what we could each month for the Montgomery Ward washer and dryer that kept us from having to go to a dreaded laundromat!). We’ve only bought homes that would give us a mortgage payment we could comfortably pay with one income. I look for sales and clip coupons, driving my kids nuts every time they go out to eat because I’ll make them wait while I dig up a coupon for them to use. Bad things can still happen, but the fall will be much less spectacular.
Folks are finally learning that the peace of mind they have from living within their means is more valuable than all the trinkets they had while living from paycheck to paycheck. A few scars may help avoid a lifetime of stress and pain.