A couple of years ago, if you didn’t own a McMansion, a few investment properties, and a bunch of expensive toys financed by home equity loans, you were considered foolish.
Everyone was keeping up with the Joneses – using borrowed money. Keeping up with the Joneses is expensive, but nobody thought of saving for the future because there was always more money to be had with the eternally rising prices of homes – right?
Wrong. Meteoric rises come with meteoric falls.
The housing market crashed back down to Earth and suddenly, nobody has the ability to borrow against their home’s equity.
This isn’t necessarily such a bad thing. Many people before were living in a fool’s paradise, and now they are forced to create real world budgets for themselves, and live within those budgets.
It’s also now acceptable for people to pinch pennies. Gone is the pressure to live lavishly. Even luxury magazines like Vogue talk about saving money, on their cover blurbs.
The United States is starting to enter a depression era mentality again – which is not a bad thing, because most people are no longer mortgaging their future to buy unnecessary expensive toys that they can not afford.
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