Some Frightening Personal Finance Statistics That Will Absolutely Shock You

If you are still wondering why the American economy (and the world economy) is in such a mess, here are some shocking personal finance statistics that will make you wonder no more. Keep in mind that some of these statistics date back to 2004 and even then you could see signs that all was not ripe economically.

In 2008, people between the ages of 18 and 24 spent on average nearly 30 per cent of their income just on repaying debt. This was all happening when the recommended maximum is just 10% of your income total.

A survey taken in 2007 on teens and their understanding of money showed that less than half of all teens (45%) knew how to use a credit card and just one quarter of teens understood the meaning of credit card interest and fees.

In 2008, the average American household has approximately $12,000 in debt and holds 9 credit cards. In addition, the average savings rate was then minus 0.5 percent, meaning that people were delving into past savings to spend today. That’s the worst percentage since the Great Depression.

Bankruptcies are still on the increase but for the first time people aged between 18 and 24 are declaring bankruptcy on a large scale. In 2008, bankruptcies for this age group increased by 96% compared with 10 years ago.

If these statistics are not enough to shock you, then I don’t know what is. However, you should not get worried by these personal finance statistics because such problems can be avoided (and even fixed) by learning and applying more personal finance in your life.