Now, the Joneses have no debt, meaning to stay up you are going to have to get rid of it too

Keeping up a social status has often been referred to as “keeping up with the Joneses”. This is the thing that most often causes spurts of getting with iPhones, flat screen TVs, riding lawnmowers and many other things. The Joneses are more concerned about getting rid of debt instead of spending on their credit cards.

Fed says debt within the home is going down

The Federal Reserve gave out a new report. The report shows all of the numbers for household debt in America. The recession came causing numerous to change their minds. Many decided it was really essential to get their debt paid off. Debt consolidation can help numerous. The Wall Street Journal reports that debt levels have gone down for seven quarters. Second quarter of 2010 showed a 1.5 percent reduction from the past quarter and a 6.5 percent reduction from the previous peak, in third quarter of 2008. $ 178 billion in debt was paid off within the last 3 months. People are anxious to get the debt out the door. That’s a lot of individuals basically giving themselves a cash until payday each month.

A few caveats

Falling household debt and an increased savings rate isn’t the entire picture. Consumer debt is going down. But delinquency has gone up a bit. This quarter was also the first instance of delinquent debt being reduced, which fell by 0.5 percent. Unfortunately there’s an additional thing to consider. Bankruptcy went up 34 percent. It seems fewer people are using pay day loan to keep up with paying for credit cards, as 272 million accounts were closed and only 161 million opened. Credit card companies aren’t doing all that well. They might need their own emergency cash loans.

Debt dying off

Americans are trying desperately to get rid of their debt. More people are trying to pay credit cards off than get new ones. You will find more people going bankrupt though. Still, there are a lot of good signs that people want to stay out of debt, preferring the security of cold, hard, cash.

Further reading

Wall Street Journal

blogs.wsj.com/economics/2010/08/17/ny-fed-households-continue-to-reduce-debt/