For many people striving to increase their wealth, the current financial debt crisis has led to much worry and stress. Almost every US citizen has heard about the government reaching its debt ceiling at $14.294 trillion on 2 August 2011.
Essentially, what this meant is that the government would no longer be allowed to owe any more than this amount.
The economic crisis taught two things to those wanting to work towards a more affluent future, as well as those simply wanting to avoid financial problems.
The first thing is that as US citizens, people do not have any power to change the outcome of this crisis. The second thing is that this situation offers an excellent lesson in how to manage your personal finances.
On one hand, when you begin to research and understand the dynamics of the debt crisis as well as the views of all parties involved, there is much peace of mind in the fact that you should not worry about the financial crisis.
The main reason for this is that historically, the situation is not unlike the large number of times that the government has voted in order to increase the debt ceiling since it was developed in 1917.
Ultimately, this is a routine process that has largely gained publicity from the debates between two parties.
On a personal level however, these circumstances (the national debt crisis) can be applied to your own financial situation.
You could think of it like maxing out your store and credit cards, and then trying to decide if you should increase your credit limit even further or keep it as it is.
This decision affects whether you will go for broke and avoid serious debt, or to sink further into debt but keep yourself solvent for now.
This is a short-term solution, but as anyone who has reached their financial goals knows, it is definitely not the answer to growing your wealth.
At the end of the day, what this means for most financially-minded people is the much debated question: ‘Is the glass half empty, or half full?’
If you choose to focus on the problem rather than the solution, you may never learn how to change your current situation.
On the other hand, if you think like most wealthy folk do and focus on the opportunities in the situation, you may find that you can build your wealth despite the circumstances.
‘Surviving’ people tend to see the obstacles, while ‘thriving’ people tend to see the potential.
Whatever your political beliefs may be, there is no doubt that economic crises such as the 2011 debt ceiling creates a huge deal of doubt and stress.
The outcome of such a situation may affect the country, economy, currency and people, but if your current outlook isn’t changing things in your personal economy, then perhaps it is time to look at other ways of thinking.
Has your Mind ever wondered...
When government imposes a debt ceiling to citizens due to being unable to pay back debts.
Either the country pays back governmental debt or the general expenditure of the country has declined meaning tax being paid to government has decreased.
Generally a financial debt crisis means over-indebtedness.
Since we are not politicians and bankers, think of debt crisis in terms of your personal finance.
When you know you would cripple yourself if you make any more debt than what you already have, you will limit your expenditure and in doing so, prevent going bankrupt but also, you would have to adjust your lifestyle.
Seems like a no-brainer, right?
Over-indebtedness, loss of income, increase in costs & expenditure fluctuations by citizens or a country results in a debt ceiling being imposed as the majority of people cannot afford to spend as much as they used to which in turn, means the government can’t pay their own debts due to receiving less revenue from taxes.
Again, in terms of your personal finances, irresponsible splurging of resources results in mismanagement teaching you a lesson to learn to control yourself and your actions.
There have been multiple, but our most recent ones include The Great Depression in 1932, The Global Economic Recession from 2007 - 2009 and of course the collapse of many businesses due to the CV-19 Pandemic which started in 2020.