Over the past years, real wages have not been keeping pace with inflation.
In fact, the average household income has steadily decreased for five years in a row.
Despite this, consumption continues to increase.
How can this be?The answer is, people have been increasing their amount of personal debt.
About 95% of Americans don't have enough saved for retirement, yet constantly buy, buy, and buy.
The nations economy is growing.
Politicians point that out all the time, but fail to mention that the economic expansion is largely a result of people buying what they can't afford and going into debt.
A Federal Reserve study showed that 43% of US families spend more then they earn.
The only way to do that is to use credit.
The credit card industry collected 43 billion dollars in late-payments, over-limit, and balance-transfer fees in 2004.
"You like it.
You buy it.
You deserve it.
", is a common trap that individuals fall into.
"Oh no, the mail is here.
" With the average American family owing about $19,000 on non-mortgage debts, its no wonder that mail deliveries have become a dread.
All that seems to come are bills and more bills.
Between all the bills are credit card offers, even ones you have already received 5 times last month.
Many people buy into credit cards thinking it is a way out.
But unfortunately, you eventually must pay.
"But I always make the minimum payment.
" Making the minimum payment will keep your credit report looking good as far as reporting agencies are concerned.
You pay on time, and you pay what is necessary.
Unfortunately, you are playing right into the hands of the creditors.
The less you pay on your balance, the more interest they make.
Lets say you have a balance of $6,000 on a credit card.
With an interest rate at 17.
5%, and paying the minimum $90 each month; you will pay around $15,240 in interest and possible more over the 20 years it takes you to pay it off.
Wouldn't you rather use that on something else? Then there are always medical emergencies to worry about.
A medical emergency without proper insurance, and even with it, can be devastating to everyone except the wealthy.
"There must be a way out!" You could take out an equity loan on your house - assuming you have enough equity to make it worth your while.
You could always file bankruptcy.
Though recent federal laws have made bankruptcy procedures so expensive that people in dire financial straits cannot even afford the filing fees.
Is there a reasonable solution? Yes.
Just think about it.
If you need more money to pay off your debts, then you simply need to make more money.
This doesn't mean you need to go out and search for another job; it simply means you need another income source to add to what you already have.
You need to find a way to bring in income without the undue stress.
If this sounds impossible, there is good news: It can be done.
Thousands of other people have already proven it.
If you are determined, a home-based business is a viable method for generating a second income.
All you need is a computer with an Internet connection and a phone.
Imagine working from the comfort of your home, interacting with people who are just starting out like you and are now making fortunes.
The way to financial solvency, and even wealth, is open to you.