how would personal finance on a personal level affect the US economy?
How does personal finance affect the economy?
If you've watched the news in the last few days or weeks, you will have seen that there are a record number of foreclosures on houses right now.
Many people got in over their heads with ARM's or other types of creative financing on houses that they now can't sell because the housing market has gone down. Subprime lenders make loans to people with poor credit, and rising defaults in those loans have been a factor in the stock market's volatility this past week.
So, I'd say personal finance can have an effect on the overall economy.
Reply:People with bad personal finances are not able to make as many purchases, spend as much money, or save as much money. They get in debt, default on loans, and generally have a harder time managing money. They often do not save enough for retirement.
Bad personal finance is bad for the economy overall.
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