Save (Some of) It For Later

New numbers reveal positive trends, but good habits are still important.


The recession spooked people. At its worst, the economic uncertainty (and near calamity) had people hesitant to spend money on anything beyond the bare essentials.

Now, the climate is shifting again. Economic growth came in at 3.2% in the fourth quarter. Consumers are sticking their heads out of their shells and diving back into spending. An article on CNNMoney reports increases in salary and spending as well as a decrease in saving.

The first two are good news, and, to a degree, so is the last practice. Let’s take a look at the stats to see what’s really going on. The numbers come from the Commerce Department as reported by CNNMoney.

  • 0.4%: The rise in personal income in December, thanks in part to the payroll tax reduction.  
  • 0.7%: The increase in individual spending in the final month of 2010.
  • $614.1 billion vs. $634.4 billion: Monthly savings by Americans in December 2010 and November 2010 respectively.
  • 0.7%: The level of the Personal Consumption Expenditures Price Index. The figure represents the lowest ever for the inflation indicator. The ideal level is between 1.6% and 2.0%.

The numbers are largely positive, but an improving economic world shouldn’t deter consumers from saving. It's a beneficial practice no matter the economic temperature.

Credit unions can help members manage their finances correctly. Whether it’s through programs that incentivize saving or financial literacy courses, credit unions should reach out to members and emphasize that good financial habits such as saving make sense independent of the overall economic environment.  


Jan. 31, 2011



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