Aug 26th, 2011 | By Dr Jerry D Elrod | Category: Senior Moments Blog

Should Seniors Spend or Save?

How do we respond to the conflicting messages of our spending, in order to help the economy, and not spending to protect our own pocketbook?  This current horns of a dilemma seems to contradict our own common sense. ” When things get tough, the tough get going” so says a familiar quote. However, going where is the paramount question.  What is the best and most helpful strategy for persons, like retirees, who generally live on fixed incomes, whose resources can be drained and whose security can be threatened?

The conflicting political ideologies suggest that spending is the time proven method for getting the economy on its feet or cutting spending (and doing what with the money?) is the most wise approach for creating frugality and diminishing government influence.

Having lived, although as a child, through the late stages of the Depression, the former ideology seemed, to my untutored mind, to be the best approach.  The 50′s, following on that terrible war, demonstrated how spending and productivity were spurred by an economy that moved full speed ahead.  Extenuating circumstances prevailed, to be sure.  But among those circumstances, even going back to the 30′s, included a stimulus which put people to work, at government expense.  And there were those who suggested, rather vehemently, that Roosevelt did so at the expense of “betraying his class,” the rich.  Sound familiar?

Wealthy Protected, Poor Ignored

Why do the rich seem to be “coddled,” to use Warren Buffett’s terminology?  The turn of the 20th century showed how robber barons manipulated everything to their advantage, children, women and men suffered from pittance wages and few rights.  The wealthy were protected.  After all, it was they who provided the jobs. It was not a good time to be poor, but it was a wonderful time to be rich.

To spend or not to spend, that is the question.  For some it is a redundant question.  If your resources are tightly pinched, how does spending help you?  If someone else spends, but sparingly, how does that help you or them?  If the government eliminates what few resources may be available to you, where do you go next?  If the government continues to insist upon frugality for all but the rich, how do we maintain a level of existence which contributes to our society and its economy becoming healthy again? How do I know whether I should spend or not? It is clear if I have little to spend.  It is very clear if my resources continue to be threatened. It is also quite clear if the government reinstates a policy and practice that shows compassion and demonstrates sensitivity to those who really need it.

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