American Culture Is Why People Don’t Save Money

Posted by Jeffrey Strain
November 25, 2009

Here is an interesting question to ponder. Is the reason that Americans are such lousy savers due to the freedom that parents give to their kids as opposed to how children are raised in other countries? We aren’t told who we should marry, we aren’t told what job we should do, but we are also not told to save money…

The other interesting question is that if we are creatures of habit and the current economic conditions are forcing people to change their previous spending and saving habits, will these new frugal tendencies stick with the current generation like saving money did with those from the great depression? These are questions that Dan Ariely, Professor of Behavioral Economics at Duke University tackles in this short video:

Your thoughts?

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Information: November 25th, 2009; 10 Responses

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Reader Comments

Comment Number:: 1
Written by:: Craig Ford (Subscribed)
Posted on:: November 25, 2009 at 5:42 am

So many people are habitual spenders. This is culturally influenced. We spend because those around us spend and sometimes it is hard to get away from consumerism.

Comment Number:: 2
Written by:: Broken Arrow
Posted on:: November 25, 2009 at 7:38 am

I can’t see the video because it’s blocked at work right now. I’ll watch it later.

Just wanted to point out that you might want to edit out the word “suck”.

Comment Number:: 3
Written by:: Financial Samurai (Subscribed)
Posted on:: November 25, 2009 at 7:55 am

We have some of the wealthiest individuals, and most innovative companies in the world, so I beg to differ.

Americans like to go for broke, and that’s a good thing.

Don’t listen to statistics! Americans save more than you think.

Best,

Sam-urai

Comment Number:: 4
Written by:: gertymac
Posted on:: November 25, 2009 at 8:37 am

“Don’t listen to statistics! Americans save more than you think.”

Ignoring facts is never a wise move.

I think it has more to do with the “American Dream” than freedoms we allow our children. We’ve been taught to measure success in material objects and how much of our wealth we can put on display for others to see. We don’t tell our children to save money, but they see us spending it instead.

I hope this new frugality will stay with people.

Comment Number:: 5
Written by:: Jackie
Posted on:: November 25, 2009 at 9:01 am

I think one of the big changes is that you hear people saying that they wished it was a requirement for schools to teach a personal financial class. Maybe parents won’t be directly their kids’ lives any more or less, but want to see this information become part of their educational curriculum. And I’d be all for it. You’d still see people making mistakes, going into debt for frivolous stuff, but they’d then already have the tools to help themselves or know where to start looking for help.

Comment Number:: 6
Written by:: WhiteEyebrows
Posted on:: November 25, 2009 at 9:10 am

Heard on NPR the other day that the Indian MIDDLE class has a savings rate of 30%. They are going to be a WEALTHY people in a generation or two…

Comment Number:: 7
Written by:: pfadvice
Posted on:: November 25, 2009 at 9:48 am

@ Broken Arrow – fixed. Thanks

Comment Number:: 8
Written by:: John DeFlumeri jr
Posted on:: November 25, 2009 at 10:45 am

Almost anyone can learn to be a saver. It is a thing to teach our children. It always pays off!

John DeFlumeri Jr

Comment Number:: 9
Written by:: elkbelk
Posted on:: November 26, 2009 at 2:50 pm

It’s because of conditioning that Americans lack a savings culture. And now there are paying the price for that.

Comment Number:: 10
Written by:: Broken Arrow
Posted on:: November 28, 2009 at 11:43 am

Ok, I finally saw the video.

I do think that the American culture lends itself to be more individualistic. Although you may not have said so, Jeffrey, I’ll bet you know that better than anyone having lived in Japan.

But that individualism does not come without a price, which as the professor points out, it also grants us Americans the freedom to fail to spectacular fashion.

From my personal observations, it seems that most things in life is both a vice and a virtue. Sun Tzu, and I know it may sound kind of corny to be referencing him here, already figured out long ago in the Art of War that one must be able to leverage our strengths and compensate for our weakenesses. But when he said that, he wasn’t talking about two separate things. I believe he was talking about the same thing….

Not just Americans, but everyone needs to know when certain attributes in us is going to be useful, and when it is not. You use it when it is, and you don’t when it it isn’t.

Something like that. Sorry, my brain is on vacation.