3 Reasons America Needs a Recession

Here’s a fun drinking game. Turn on any cable news program, and do a shot of your favorite liquor every time you hear the word “recession.” After half an hour, you should be nice and hammered like one of those shirtless, mullet wearing losers on Cops. No doubt about it, the majority of people in this country are feeling the strain of these rough economic times, and they’re all too happy to complain about it. But I’m not one of those people. In fact, I believe there are 3 good reasons this country needs a recession.

1. Wake Up Call- News flash- the people in Washington, D.C. could care less about whether or not you can afford to fill up your gas tank. I’m not condemning one particular party- neither of them care. Relying on the government to solve your financial problems is foolish and naïve. You think President Bush is going to write you a nice little stimulus check once a month? Get real. You think Obama is going to waltz into office and suddenly you’ll have a nice statement on your bank account? You can hope and believe in the power of change all you want, but that’s not going to happen. These bad economic times are just the wake up call the American public needed. You alone are responsible for your financial situation. The sooner you realize this, the better.

2. Stop Excessive Spending- Let me explain. We are a nation full of people who spend like drunken sailors. It starts at the top with our government, and these spending habits trickle all the way down to individuals like you and me. The vast majority of Americans break the first rule of personal finance- you can’t spend more money than you make. What a novel idea! 

This is precisely why I believe these difficult economic times can be a good thing for Americans. High gas prices and the increased cost of food have forced many people to rethink their spending habits. Whether they like it or not, they have been made to reel in the spending.

The truth is that many of us are now, out of necessity, spending the way we should have been all along. Instead of splurging on that 60 inch flat screen we don’t need, we have to get the more practical 36 inch model. And we’re better off for it.

3. Learn to Save- In general, Americans are terrible at saving money. The average family in the United States saves less than 1% of their annual earnings. Over in the UK, they save about 10% of their income. If nothing else, I hope this downtime will teach Americans how to save money. Before you go out and charge something you can’t afford, put aside about 10% of your paycheck. In fact, just pretend you make 10% less than what that number on your paycheck says. If you do this for long enough, periods like this won’t have any effect on you. Your stress will be reduced, and you will be in the prefect position to retire with a nice nest egg.