Society has come a long way in a relatively short period of time thanks to a slew of technological advances and developments designed to change the way we do things – and for the better.
But, progress isn’t without its setbacks, and many of these setbacks rear their head when it comes to money. Unheard of just half a century ago, here’s a look at some of today’s top money problems (and what you can do to avoid or resolve them).
Credit Card Debt
Outstanding credit card debt in the United States stands at currently more than $1 trillion. The average American currently owns about 2.6 credit cards, and is more than $8,000 in credit card debt.
Being in credit card debt can lead to a bunch of other problems, such as a lower credit score, paying more long-term for purchases thanks to interest rates and more.
Dealing with credit card debt isn’t fun, but it’s not impossible to overcome. What you will need to do is set a debt management plan and commit to it. It’s much easier said than done, but it’s something that should absolutely be done before the debt escalates into something that’s much more difficult to manage.
Retirement Savings
Back in the day, most companies offered pensions for their workers, a retirement reward of sorts for spending an entire career with one company. Those days are largely gone.
Today, only about one-third of all American retirees have any pension, and it’s likely that five years from now, that one-third number will be much lower. The good news is that most companies offer 401K savings plans as a benefit, but being that workers have to allocate a percentage of their earnings toward it, it’s a retirement plan that’s largely dictated by the worker, not the company.
So, how can you avoid a retirement income shortage? Be diligent with your retirement savings, and spread them out between IRAs and 401K plans.
Identity Theft
Thanks to the internet and credit cards, this has the potential to be one of the biggest financial threats that people deal with today.
Just months ago, nearly half of all American consumers were victims in an Equifax data breach, and it seems that we’re hearing about new hacking and data breaches every week. You can help prevent identity theft by using good, secure and different passwords for your online accounts. Also, never access these accounts over public Wi-Fi, as you never know who might be watching you. Be careful what you post on social media, see if you can set fraud alerts on your credit and debit cards, and, perhaps most importantly, check your credit report.
By law, each American is privy to one free credit report each year from each of the three major credit bureaus. Check it out and take note of any inaccuracies or things that look suspicious, and immediately report it to the bureaus. Identity theft has the potential to spell financial ruin if you’re not careful, diligent and quick to respond. There are bad people out there, and the Internet has empowered them.
Medical Costs
There’s no question that the world we live in today is a better one in terms of how far medical technology has come. But with these great advances in medical technology and treatments also come greater prices.
Flashback to 1967 for a moment, when Americans spent more than $43 billion on medical care expenses. Today, Americans spend nearly $3.5 trillion on it, which translates to more than $10,000 per person. The thing is, everyone needs healthcare coverage because the out-of-pocket costs for many treatments and procedures are far too great without it. How can you reduce this expense? You could work for a really good company that doesn’t make employees contribute to medical care plans. Another option is to go with a higher deductible plan and put money into a heath savings account (HSA) or flexible spending account (FSA) to help offset co-pays or other out-of-pocket costs.
Finally, contact your elected officials, as the status of the Affordable Care Act plays a big role in today’s healthcare market. Repealing or replacing it could likely yield some favorable benefits for insured consumers.
Regards,
Ethan Warrick
Editor
Wealth Authority
