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Technology Makes It Harder To Save Money
Hugh Pickens writes "LiveScience reports that a survey conducted for the American Institute of CPAs reveals that while more than half of U.S. adults believe technology has made it easier to spend money, just three percent think it has made it easier to save. The research found that Americans who subscribe to digital services spend an average of $166 each month for cable TV, home Internet access, mobile phone service and digital subscriptions, such as satellite radio and streaming video — the equivalent of 17 percent of their monthly rent or mortgage payment. Those who download songs, apps and other products spend an additional $38 per month. 'Our gadgets and connections can bring benefits like mobility and efficiency,' says Jordan Amin. 'But they can also bring financial challenges, like taking money that could go to savings, for instance, or contributing to credit card debt.' If facing a financial crunch, Americans would rather change what they eat than give up their cell phones, downloads or digital TV services. Asked to choose the one action they would most likely take in tight time, 41 percent said they would cut back on eating out, 20 percent said they would cut off cable TV, 8 percent said they would end cell phone service and 8 percent said they would stop downloading songs and digital products."
by giving up TV. With internet access and a mobile phone, you really don't need TV.
where a $200 cellphone with a multi-year contract of indentured servitude and mandatory upgrades is an essential item
but a meal that costs over $7 and doesnt come with a free cola is a sure sign of the imminent collapse of western civilization at the hands of a communist marxist kenyan muslim.
Good people go to bed earlier.
"41 percent said they would cut back on eating out, 20 percent said they would cut off cable TV, 8 percent said they would end cell phone service and 8 percent said they would stop downloading songs and digital products."
If I cut my TV service my phone bill goes up, if I cut my phone my TV bill goes up. If I cut either I have to pay a fee to terminate the contract. Of course I'm going to cut back on eating out.
People are willing to change what they eat because their cell phones plans have steep early termination fees if you drop your level of service - same with your digital television or broadband connection. Temporarily changing your dietary desires is much more simple - not a sign of technology addiction, more a sign of service charge and penalty avoidance.
Good. Humans don't need meat every day anyway.
Give me Classic Slashdot or give me death!
Just get a decent connection for say $50 and bittorrent the rest. =)
Big thing is to first know where you are spending money, and then categorize your expenses into what is a can't-do without, must have, nice to have, and frivolous buckets. You need to put about 10% of your income into a long-term retirement fund, and have (ideally) six months of living expenses in a money-market or savings account (Must have). You need to put a certain amount of money aside each month for certain necessities (housing, required food, loan payments) (can't do without (unless you're living in your parent's basement)). Most of the rest of it tends to be the nice-to-have (like cell phones, phone lines, new clothes, eating out).
I would agree that cable internet is indispensable to me for work purposes, and would be one of the last things that I would cut back on in the event of a major problem (like losing a job).
I pay about $225 for phone service, cell phone service, and satellite service, with another $50 for cable internet (total of $275). I've looked at getting rid of the home line and going strictly cell phone, but my spousal overlord unit isn't ready to do that yet, and with three teenagers in the house, I expect my telephone costs to be going up here until they move out of the house.
I remember starting grad school 20 years ago spending $1,400 on a little 1 piece Compaq Presario and thinking - "Good thing for credit cards or nobody could buy a computer." And then I realized - there will always be "the next big thing' in technology for people to spend money on. Bigger tvs. Even bigger tvs. Flat screen tvs. 3D tvs. Sony Walkmans, mp3 players, iPods, iPads, notebooks, Netbooks, cell phones, smart phones, dial-up, broadband. I'm not saying it's all for the worse, nor am I putting on my tinfoil hat, but I'm pretty sure theirs a good correlation between the explosion of consumer electronics and the explosion of credit card debt.
This might actually help solve the obesity problem. If American's can't afford to eat out because they are spending too much money on tech, maybe they will eat healthier homemade food. One can hope.
Oh, and technology doesn't make it more "difficult" to save money, it just makes it easier to spend a lot of money. I can save my money just as well with technology as after. More, actually, since technology gives you lots of cheap or free entertainment, which is less money spent in bars or going out to movies or on gas.
Also helps that I don't own a smartphone or iPad. Don't need one, either. I do have a wifi-equiped MP3 player: no monthly contract, and works for 90% of the things I would need a smartphone for. A messenger phone works for the rest.
"None can love freedom heartily, but good men; the rest love not freedom, but license." --John Milton
Why even save? It's the responsible ones the fed hurts; interest rates should be upwards of 20% instead of the bullshit we have now.
Because it means that those of us 'young folks' (less than 30) in the USA who can actually plan their finances stand to be KINGS and QUEENS in the future. My wife and I live very, very comfortably on what my friends would call a meager pittance (we both work in education, thank you). Our stuff isn't as nice as what they have, but we also don't have the crushing burden of debt looming in our future. We may not have a MONDO flat screen, but we do have a high speed internet connection and access to as many movies and television shows as we need. We may not have a $70k car, but what we do have is reliable and gets 35-40 mpg. Our house might not be a McMansion, but our small house does sit on 67 acres of woodland. . . .
We're saving for a college fund for children we don't have yet, saving for early retirement and generally living the life of leisure.
Why am I saying all of this? Because, not all Americans are idiots. Most that I know are kind of stupid, but really not that bad.
And some, like my wife and myself, are actually quite bright. Not meaning to brag, just meaning to point out that people like us exist.
People spend money
Not technology
Because of the Internet, I stopped paying for porn years ago.
Statistics, damn lies... 41 percent sounds like a lot more than 8 percent, making it sound like people will choose music downloads over food, but the truth is most people don't download music.
Currently hooked on AMP
It matters less what you are doing with the flow of your metric, and more on your net balance.
Whether I spend $300/mo on digital services or buy a bigger house than I need, or a nicer car than is necessary for my requirements, it's the same dollar at the end of the day. Americans are gaining weight because of easy access to high-calorie food that is made to be appealing through advertising and instant sensory gratification. Americans are not saving because our entire economy is based on spending as much as possible on things which are made to be appealing through advertising and instant sensory gratification.
Is it just my observation, or are there way too many stupid people in the world?
I also view tech saving tools as a hindrance to saving. I've tried a lot: Quicken, Money, Mint, the venerable Pear Budget, etc. All tools that allow you to grok where your money is going, but provide little incentive or mechanisms to curb spending. We collect all this great data and then say "huh..." and shrug our shoulders.
My parents always had a drawer in the clothes dresser that had the "house money" in it for the month. Once that cash was depleted, there was no more money for the house, period. This was real incentive to spend wisely and to see how much money was left. If there is a technology that can easily enable this "cash envelope" system, I am not aware of it.
Technology saves on:
This requires a future, of course, where society is advanced enough to grant new rights
Which is not where we are going. We are busy killing existing rights, rendering them useless, as well as deploying increasingly many computer systems whose owners need the permission of someone else just to run a program. The next generation will indeed be shocked by today's computer climate:
Hackers won round #1 with the PC, and round #2 with the Internet. Hackers are losing round #3, as governments and corporations focus increasing effort and money on taking back control of computers and computer networks. There is just too much profit to be had from it.
Palm trees and 8
constantly tries to invent ways for people to spend more, and rapid technical innovation is at the core of that process. You have to outstrip not only the ability of people to simplify their lives, but outdo the very desire to do so.
Really what has to happen is that people have to decide they aren't going to sign contracts for luxuries. My income has fluctuated so wildly over the last several years that I absolutely will not sign a contract for a luxury. Sure I can afford a $70 a month phone now, but what about 1 year from now? So I go with cheaper, non-contractual alternatives. I pay $37 a month for Virgin Mobile but I can drop it any time and go with a cheaper alternative (TracFone) or nothing at all. For awhile I dropped Netflix, stopped watering my backyard, stuck with TracFone, etc to minimize my monthly expenses.
Contracts lock you into a particular life style that you may not continue to be able to afford. You need to be able to cancel services as quickly as you can lose a job.
People can have nice things even without being rich, but it's the effort to have all the nice things all at once that keeps people in debt and poor. Once the house is paid off, that's $1200 a month I'll have for other nice things. In the meantime, the nice thing I have is a nice house.
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