Jaspreet Singh: Americans Are Spending Like There’s No Tomorrow
Written by
Adam Palasciano
Edited by
Cory Dudak
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
In one of his latest videos, financial guru, attorney, and entrepreneur Jaspreet Singh explained that “Americans are still spending money like there’s no tomorrow. Concerts, trips, and designer handbags are taking priority over saving for a home or a rainy day,” explained Singh.
According to the U.S. Department of the Treasury, in 2023 the median American worker can afford the same goods and services as they did in 2019, plus an additional $1,000 to spend or save. This is because median earnings have finally risen faster than prices.
Now, this statistic is proving true with American spending on the rise.
Americans Are Spending More Money
Singh explains that because of higher interest rates, the resumption of student loans, and continued high inflation, a lot of people have been having to face the fact that the cost of living is rising. If you’re not making enough money to continue living this lifestyle, you’re faced with a choice: Do you make lifestyle cuts, or do you go deeper into debt and make financial sacrifices so that you still have the nice things?
It seems that many are choosing to spend rather than cut back. The Wall Street Journal reported that household spending remains strong, which is a primary indicator of the nation’s economic growth. Americans spent 5.8% more in August than a year earlier, well outstripping less than 4% inflation.
More People Are Spending Now Rather Than Saving For Goals Later On
“Americans are saying you know what, screw saving and screw investing. Let me keep spending my money. But, this could be a bigger problem in the future,” highlighted Singh. “Consumers should be spending less money by now: interest rates are up, inflation is high, pandemic savings are shrunk, and the labor market is cooling. Yet, household spending remains robust.”
With goals such as saving for a down payment on a home, setting retirement goals for the future, or building a rainy day fund seemingly out of reach, many are choosing to live for now and simply spend the money (or even go into debt).
The economic system runs on spending more money. The more you spend, the more money somebody else makes. So when you spend money to shop, then go into debt to spend money on airline tickets, when you dig into your retirement savings, or when you pull out home equity or go into credit card debt: these are all good for the economy.
Many Americans are choosing to live this way so that they can keep shopping and living the “high lifestyle.” The bottom line is that this kind of financial behavior is good for businesses, but it’s not so good for the consumer.
Today, more and more Americans say that they don’t want to sacrifice the lifestyle they have, even if it means not saving money or taking on debt to maintain it. However, this could lead to a rude awakening sometime in the future.
More From GOBankingRates
