The Oligarch Recovery – 30 Million Americans Have Tapped Retirement Savings Early in Last 12 Months

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The ongoing oligarch theft labeled an “economic recovery” by pundits, politicians and mainstream media alike, is one of the largest frauds I’ve witnessed in my life. The reality of the situation is finally starting to hit home, and the proof is now undeniable.

Earlier this year, I published a powerful post titled, Use of Alternative Financial Services, Such as Payday Loans, Continues to Increase Despite the “Recovery,” which highlighted how a growing number of Americans have been taking out unconventional loans, not simply to overcome an emergency, but for everyday expenses. Here’s an excerpt:

Families’ savings not where they should be: That’s one part of the problem. But Mills sees something else in the recovery that’s more disturbing. The number of households tapping alternative financial services are on the rise, meaning that Americans are turning to non-bank lenders for credit: payday loans, refund-anticipation loans, pawnshops, and rent-to-own services.

According to the Urban Institute report, the number of households that used alternative credit products increased 7 percent between 2011 and 2013. And the kind of household seeking alternative financing is changing, too.

It’s not the case that every one of these middle- and upper-class households turned to pawnshops and payday lenders because they got whomped by an unexpected bill from a mechanic or a dentist. “People who are in these [non-bank] situations are not using these forms of credit to simply overcome an emergency, but are using them for basic living experiences,” Mills says.

Of course, it’s not just “alternative financial services.” Increasingly desperate American citizens are also tapping whatever retirement savings they may have, including taking the 10% tax penalty for the privilege of doing so. In fact, 30 million Americans have done just that in the past year alone, in the midst of what is supposed to be a “recovery.”

From Time:

With the effects of the financial crisis still lingering, 30 million Americans in the last 12 months tapped retirement savings to pay for an unexpected expense, new research shows. This undercuts financial security and underscores the need for every household to maintain an emergency fund.

Boomers were most likely to take a premature withdrawal as well as incur a tax penalty, according to a survey from Bankrate.com. Some 26% of those ages 50-64 say their financial situation has deteriorated, and 17% used their 401(k) plan and other retirement savings to pay for an emergency expense.

Two-thirds of Americans agree that the effects of the financial crisis are still being felt in the way they live, work, save and spend, according to a report from Allianz Life Insurance Co. One in five can be called a post-crash skeptic—a person that experienced at least six different kinds of financial setback during the recession, like a job loss or loss of home value, and feel their financial future is in peril. 

So now we know what has kept meager spending afloat during this pitiful “recovery.” A combination of “alternative loans” and a bleeding of retirement accounts. The transformation of the public into a horde of broke debt serfs is almost complete.

Don’t forget to send your thank you card to you know who:

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For related articles, see:

The Oligarch Recovery – Study Shows Real Wages Have Plunged for Low Income Workers During the “Recovery”

The Oligarch Recovery – Low Income Americans Can’t Afford to Live in Any Metro Area

The Oligarch Recovery – Renting in America is Most Expensive Ever

Another Tale from the Oligarch Recovery – How a $1,500 Sofa Costs $4,150 When You’re Poor

The Face of the Oligarch Recovery – Luxury Skyscrapers Stay Empty as NYC Homeless Population Hits Record High

Census Data Proves It – There Was No Economic Recovery Unless You Were Already Rich

Use of Alternative Financial Services, Such as Payday Loans, Continues to Increase Despite the “Recovery”

In Liberty,
Michael Krieger

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7 Comments

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  1. Deanna Johnston Clark

    Families need to stick together through this. For some, it’s intervention time with addictions. For others, it’s we-first instead of me-first.
    In the 1929 depression drug use went way, way down…any sign of that yet? Some young people need to get humble and let their parents help with budgets…it ain’t 1996 anymore. Sc**w Starbucks lattes…get real!
    This is very sad about the payday loans…”loans” HA…they are confiscations and should be illegal. And where are the churches these days?

  2. I liked the comment in the Money article about saving 3-6 months of Income for a rainy day……but they Forgot to explain…HOW Mr and Mz American Public could even come close to doing that in Today’s Economic Circus…! thanks for reading

  3. The majority of people need a universal basic income since jobs and incomes are disappearing in the 21st century. The 1% criminal oligarchy creates money for itself. Any group of people or organization can create the legal-accounting fiction that is money-currency – and without debts/loans. To see how this can be accomplished legally, creatively, cooperatively and quickly, please visit the Free WGO educational-advocacy website here: http://www.i-globals.org. Ask all your questions to [email protected]. Thanks.

  4. How about living small, not having every gadget, cheap vacations and saving money? Stay under budget. Why is it always someone else’s fault, because you overspent?

    • What planet do you live on? You reason like a simpleton. You seem to think that the economy’s problems are caused by people going out and buying electronic gadgets. Of course, spending more than one takes in is not a smart move, but that doesn’t ruin a nation’s economy. MASSIVE government deficit spending has a HUGE impact on individuals’ budgets–it’s called INFLATION. Our political wh#res in Washington DC bail out their friends on Wall street–with deficit fueled, taxpayer dollars. The US has over 1000 military bases throughout the world. That cost drains an economy. It is just amazing to me. People like Mark Olsen piss and moan about “individual responsibility”. Well that’s convenient. It sure keeps people thinking about the REAL troublemakers in a national economy: governments that are owned by Special Interests. BTW: WHERE do you get this idea that people are going on luxury, expensive vacations? It has no basis in reality. Are you a Trust Fund baby who has never worked a day in your life? You write like one.

    • Deanna Johnston Clark

      You’re both right…and PLEASE let’s not forget the huge sinkhole of drugs and pills that gobble the savings of family members. Is there anyone not grappling with that in their circle of responsibility?

      Mark is correct…self control needs to be relearned by many people who grew up in the “Charge another trip to Orlando” 1990s. Did they even repair cars in that decade?
      But also, unless you are just a me-first soul, you will have family and friend connections you love who can be a help or another sinkhole, probably both Many grandparents are raising grandchildren …often without benefit of tax deduction. That’s my life.
      Paolo…we do have to be humble and think of the ways we were all complicit over the years. We all benefit from public services, not just banks. We can’t just shake our fist at the Monopoly guys…we do have power over our attitudes. Of course, cussing them IS fun and cathartic!!!

      Now if you know any REAL trust fund people, you know how thrifty and frugal they are. They are at Dunkin’ Donuts in the morning, not Starbucks, and at a town hall meeting later that others are too tired to attend. They also contribute to the charities that make your town a nicer place to live…noblesse oblige.

      Don’t confuse trust fund people with yuppies and their bling cars and showing off. Go out and meet real humans away from this gadget. Go to a Boys and Girls Club board meeting.
      I think we are all very concerned and have something to share…and that’s what God wants us to do. Our biggest enemy is selfish prejudice whoever we are.

  5. Paolo,

    You dumb ass.

    I am guessing that you work at a University, And can not stand success in others.

    I am not a trust fund baby, what I have, I earned.

    Minimum college debt, because I worked at a job and didn’t bitch and moan that you do.

    Self employed as a salesman. What I have I earned.

    Bought a farm and paid it off, not complaining about everyone else.

    Have a lake cabin, almost paid off, again, not by any help from anyone else.

    Raising 4 kids, who have most of their college paid.

    Sure, the Government way over spends, not me.

    Don’t move out of New York.

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