It’s amazing: The current financial crisis is providing a time of introspection, and many Americans are deciding to pay down debt. Yes, that’s right. According to MarketWatch, household debt has been paid down for the first time since 1952:
As of Sept. 30, the total outstanding debt for households shrank at an annualized rate of 0.8% from $13.94 trillion to $13.91 trillion, the Fed said in its quarterly flow of funds report. It’s the first decline in household debt ever recorded in the report.
This is somewhat encouraging. Have we been awakened to the error of rampant consumerism and debt-fueled spending sprees? I’d like to think so. But we’ll have to see. Miki Saxon over at MAPping Company Success, who brought this report to my attention, points out that the sense of urgency may fade.
She points to the report from Edmonds.com that as soon as gas prices started dropping, so did interest in hybrid cards. SUVs are gaining in popularity as search subjects again. This is an interesting pattern, and one that I hope won’t be repeated with Americans and debt. It’s time to focus on the long term, and pay down debt. For good.