Can We Repair the American Savings Crisis?

By Dr. Tim Price, CPA, Faculty Member, School of Business, and Dr. Suzanne Minarcine, Faculty Director, School of Business, American Public University.  Originally published at http://onlinecareertips.com/2017/06/can-repair-american-savings-crisis/ 

The United States historically has had one of the lowest savings rates in the industrialized world. Arguably, the biggest contributor to this phenomenon is consumerism, the idea that everyone should always acquire more goods and services.

Consumerism is so ingrained in our culture that we no longer notice its effects:

Constant Advertising Encourages Spending, Not Saving

We are bombarded with advertising that encourages us to shop. We’re offered low interest rates on vehicles and we’re told there is a drug to fix whatever ailment we might have. Credit card offers arrive in the mail almost daily, each with its own incentives to make purchases.

Are you too busy to cook but don’t want to eat out? There’s an advertisement for that, too.

Consumer electronics are nearly obsolete before they ever hit the market. For example, Apple releases a new iPhone almost every year, and we need to buy the latest and greatest version, of course.

We are constantly encouraged to spend, no matter what we are doing. Go on Web browsers and social media, and ads will pop up based on your browsing history. We are targeted for spending.

The dollars spent on advertising in the U.S. are significantly higher than in any other country. The spending feeds on itself; you fall into the trap of buying more goods and services to keep up with your neighbors and friends.

How Can We Encourage Americans to Start Saving?

There is much discussion about low U.S. savings rates, but no one individual or group is actively promoting ways to increase them. For example, U.S. policymakers could add tax incentives to encourage savings. Other suggestions include increasing the tax-deductible amounts on IRAs and 401(k)s and making some or all of your interest and dividend income tax-exempt.

For regular savings accounts, the money is taxed before it goes into savings. As interest accrues and the money grows, taxes are paid annually on the amount of interest earned.

Savings needs to be encouraged. Personal finance lessons should be embedded in the messages children receive from an early age, as early as kindergarten and extending into adulthood. Lessons in personal finance could be incorporated into school curricula, like science and math.

Low Savings Rates Means Less Saving and Less Money for Loans

At a macro level, low savings rates foster an increase in consumer spending, which spurs economic growth. However, it also means less investment in the economy, since your dollars are going to consumption rather than savings and investments. Less money in savings means banks have less money to lend.

The investment void is being largely filled by other countries. But there is no guarantee they will continue investing in the U.S. Many economists fear that if the U.S. does not get its federal budget deficit and national debt under control, foreign investors will flee or demand much higher interest rates.

Japan and Germany Have High Savings Rates but Less Economic Growth

It is interesting to note that countries like Japan and Germany have the opposite problem because they have high savings rates. However, that results in less consumer consumption and lower economic growth rates.

Consumer patterns are very different in these countries and putting money into savings accounts is encouraged. This cultural practice also contributes to the trade imbalance between those countries and the U.S.

The next generation is not likely to see any change in the situation unless the U.S. takes drastic action to reduce the deficit and national debt. If we do not, foreign investors will stop investing in the United States.

About the Authors

Dr. Tim Price is a faculty member in the School of Business at American Public University. His teaching interests include accounting, economics, finance and statistics. Tim holds a Ph.D. in Business Administration and an M.B.A. in Business Administration from the University of South Florida, as well as a B.S. in Accounting from Pennsylvania State University.

Dr. Suzanne Minarcine is the faculty director for the School of Business at American Public University. She currently teaches strategic management and entrepreneurship courses.

 

A Grieving Grandmother on Mother’s Day

I cannot fathom the grief of a mother who has lost a child.  I look at my own children and how deeply I love them, and how much I’m willing to sacrifice for them, and my heart is filled with a passion that I cannot describe.  I love my children more than life itself.

I’ve often said that being a grandmother is even better than being a mother; a grandmother is the best thing I could possibly be.  The love I feel for my children is magnified in my love for my grandchildren, but part of that is because I’ve survived the teen years (let’s go ahead and admit that teens are not 100% lovable!) but I would still go to whatever lengths necessary to protect my children.  In my older son’s words, “We didn’t need Rambo in our family; we had Mombo.”  Any mother knows how much mothers everywhere loves their children and the lengths we would go to protect them.  Except when we can’t.

I’m in a special category of grandmothers, and I didn’t want to be here.  I didn’t ask for it and I didn’t want to be here.  No one wants to lose someone they love, yet  I am a grieving grandmother, times two.  I’ve lost my first grandson and I’ve lost my first granddaughter.  I’ve been to hell and back in the process.  Both were tragic, needless deaths.  Both are – and yes, I speak of them in the present tense because their spirits are very much with me – the children of my only daughter.   She’s a great mother, a better mother than I was when she was young, and I can’t begin to imagine her suffering.  Mother’s Day is not a happy day for her, though she needs to put on a happy face for her three living children.

There’s part of me that wants to quote Sheryl Sandberg in Option B, and say that Glenn and Carly would want us all to be happy and celebrate the day.  It made both of them sad when we were sad or hurt, regardless of the reason.   They were sensitive children.  We aren’t honoring their memory through our tears.  Yet knowing this doesn’t stop the intense pain.  Supposedly it will get easier with time.

As a grandmother, I grieve for my grandchildren and  I wonder who they would be now.  Would Glenn drive me around in the Porsche, or would he prefer the Cadillac? Would he still think I’m the smartest person in the world?  Would he still be delighted by everything his Bebob said?  Would Glenn love Punkin as much as his siblings?  Would Carly still love ballet?  Would she still be so opinionated and such a daredevil?  Would she still snuggle with me?  My answer to all questions is yes.

But as a mother, I grieve most of all for my daughter.  She’s not herself and she will never be the same person who brought Glenn home from the hospital.  I see her struggle.  I see her pain, sometimes written on her face and all over her, as visible as Nathaniel Hawthorne’s Scarlet Letter.  Sometimes she puts on a brave face, but behind those beautiful blue eyes is a broken heart.  As a mom, I can’t put a band aid on it and make it better.  This is something a mom can’t fix, and that compounds my grief.

How will I spend this Mother’s Day?  I’ll be on a plane for part of it, then I’ll be home.  I’ll put on a brave face and will be grateful for the day and for the people who love me.  I’ll be there for my daughter, and for her siblings who also hurt – though in a different way.  I will celebrate the lives we have and those that we’ve lost, and I will hold my family just a little closer.  I will be thankful for the time we had, and I will pray that other people will be sensitive to our emotions on this day.

Happy Mother’s Day.

Differences in Online Education – My Experience as a Student

I love learning. I love teaching and I’m a better teacher when I’m also learning. Despite a terminal degree, in my mind an additional Masters made perfect sense. I’ve put that specific degree on hold, for now, but I learned that private, non-profit is not necessarily better.

I began exploring online BSN and MSN programs several years ago. Through my employer, I could do the BSN at minimal cost but it would take at least two years because of transfer credit requirements. I didn’t want to spend two years and I was enticed by the idea that Wilkes University could get me further, faster. The admissions rep painted a picture of good instruction with superior faculty and the ability to complete the program in two years. I was looking at the MSN as my backup plan and perhaps as an opportunity to teach in a field that I love. I’ll always be a nurse, regardless of whatever else I happen to be.

I didn’t start out with the intent to ever be a nurse. I only ever wanted to be an airline pilot, but I needed a Plan B. I couldn’t get any job as a commercial pilot in 1972, other than flight instructor, and I didn’t want to do that forever. Things were tight during the oil embargo and I knew I needed some stability. Airlines weren’t hiring women and women weren’t allowed in military flight training programs. Nursing school offered me stability. I was fortunate to have fabulous instructors who inspired me and I embraced this new direction with a passion. After my RN, I earned a bachelors in general students, perhaps with the most undergraduate credits ever, then I earned a Masters in Health Policy and Administration from Mercer University.   I was fortunate enough to retire at age 43 when my company was purchased by Cigna, and I started a flight school. But that’s another story for another day. I’ve been teaching online since 2007 and I love it. I love my students and my colleagues, and I think I’m good at what I do. I think my job is relatively stable but the MSN was insurance. So I jumped in with both feet.

My first course was 16 weeks long and the extent of interaction with the professor was “Good job.” I received 100’s on everything I did. I was satisfied that the work I did was deserving of 100, but I wanted to know specifically what was good and where I could improve. This was brand new for me! The admissions rep had not painted an accurate picture of the requirements for the clinical courses, and this was frustrating. I was fingerprinted four times but the FBI was unable to read the fingerprints. I’m pretty sure the Bibb County Sheriff’s Department knows how to fingerprint people and the FBI knows how to read fingerprints, so I couldn’t tell where the breakdown was occurring. Wilkes made an exception and allowed me to take a graduate Nursing Theory course that did not require clinicals, and this was a great experience. I worked hard and my final grade of 98.9 was well earned. The feedback was comprehensive and the instructor was engaging. If I was her faculty supervisor, I would have given her the highest rating.

My final course was a disaster and the entire experience was disappointing. My father entered hospice care. The instructor stated that late work would not be accepted, no matter what. I contacted her and told her I did not anticipate problems, but my father was unstable at the time. I provided medical records to support my request, but she suggested I drop the course. She would not work with me under any circumstances. I contacted Student Services and complained. My advisor tap danced around and basically said, “Oh well.” I asked to speak with a supervisor and was told I probably needed to take the time off, anyway.

I work for a university that is student centric. We also care about our faculty. While my father was dying, I got tremendous support from my university. We are passionate about student success and we are passionate about teaching excellence. I had only seen teaching excellence in the nursing theory course. I was misled by admissions and advising, and there was no compassion. No one cared.

I’m done with the pursuit of the MSN, but I’m not done learning. Who knows what is next!

Mindfulness and Intentionality

 

The holidays are a perfect time to think about mindfulness and intentionality. It is easy to get caught up in buying gifts for people who don’t need anything, resulting in spending valuable time and money on things that aren’t important. Mindfulness allows us to enjoy the holidays through our presence, without the undue pressure of juggling what is important and necessary with what we feel we need to do. Intentionality allows us to make the important decisions and weigh the cause and effects of our decisions.

The simplest way to think about being intentional is doing the right thing for the right reason. Being intentional means making decisions that lead you towards the intended outcome. It is drawing on your inner strength to make choices that are right, in a purposeful and deliberate manner. It is weighing the pros and cons before making a decision, and choosing to be an active participant in life. I know my decisions may not be right for everyone, and that is okay. I accept responsibility for my life and my decisions, and I am aware of how my decisions will affect others. I recognize that I do not live nor work in a vacuum and that actions and decisions have consequences, therefore I act intentionally and consider all outcomes.

Part of being mindful is paying attention and being present. Mindfulness involves the deliberate attention to what is going on around with you. It is being aware of the people around you and recognizing their worth. It involves looking at people in a nonjudgmental way and accepting everyone for who they are. This is actually one of the most important lessons I learned from my father, who taught me to treat everyone as if he or she was the most important person I had encountered that day. As Mayo Angelou said, “People will forget what you said, people will forget what you did, but people will never forget how you made them feel.” Being present and treating the people around you as if they were important is the first step in building the solid relationships that will help you be personally and professionally successful.

There are consequences to every decision you make and some of your professional decisions can have a profound influence on your personal life. I made the decision to sell my business and pursue a doctorate, but I gave little thought to how it would change our lives, even the lives of my adult children. The demands on my time virtually eliminated any normal family time for the next three years. While none of us now regret my decision, there were times when everyone had to make sacrifices. I left a lucrative corporate job to teach, and that has resulted in lifestyle changes. I wish I had involved my husband more in my decisions, as he was the one who had to bear so much more of the workload at home. Sometimes the tough decisions and the results can be hard to swallow, but if you are deliberate in your thinking and consider all angles, the tough decisions may be a little easier.

We’ve just come through a very difficult political election. Many of us have not been mindful in things we’ve said and the conclusions we’ve drawn, and some of us have been unfair to people who are close to us. There have been articles about people who dreaded Thanksgiving dinner yesterday, and others about acceptable topics for discussion. My hope is that we can come together and approach the future with both mindfulness and intentionality, and heal some of the hurt of the past 18 months.

My final goodbye, with so much love

img_5317My father, Webster Marlowe, 84, of Palatka, Florida, died peacefully in his home on Monday morning, October 10, 2016. He is survived by his wife, Marie Benedict Marlowe, my brother and me, his sister, Katherine Long, of Liberty, SC, four grandchildren, nine great-grandchildren, and numerous nieces and nephews. He is preceded in death by 10 brothers and sisters and two great-grandchildren.

Daddy was born December 1, 1931, in Jacksonville, FL, to Thomas Lee Marlowe and Ola Alberta Cantee. I could never remember whether it was December 1st or 2nd, and if I called him on the 1st, he tell me to call him again on the 2nd. Many times, I forgot. He grew up on Park Street and graduated from Lee High School. His family was active at Trinity United Methodist Church, and my dad represented the Jacksonville sub-district at the Southeastern Jurisdiction Young People’s Leadership Conference. This is where he met my mother, the former Sarah Athelene Payne. She was 16 and he was 18, and he would eat her breakfast since she did not eat. Daddy joined the Army and would hitchhike to Thomasville to see my mom.

After serving in the US Army during the Korean War, my parents were married and Daddy enrolled at High Point College. I was born in 1954, and to quote my mom, I was “the apple of his eye from birth.” My brother came along two years later. There was never any doubt that my dad loved me. His long-time secretary always said that the only difference between the two of us was the plumbing. img_5186

Long before Mr. McGuire would give Benjamin (Dustin Hoffman) his one-word advice in “The Graduate”, Daddy was approached by someone to start a plastics company in 1955. Daddy said that his first question was, “What is plastics?” He co-founded Flex-O-Pak in 1955 before leaving for Rex Plastics in 1959. In 1965, he struck out on his own and founded Southern Film Extruders in High Point, NC. Daddy worked day and night to make the company a success, once even triggering my mom to bring his pillow and suitcase to the plant. He was a member and national councilman of the Society of Plastic Engineers, and we often traveled with him in the summers.

During one trip to New York City, my mom took us to see a game show called “Say When.” Before the day was out, my mother became a contestant on the show. Our short trip was img_5314extended, as she continued to win. Among her winnings were a car, a fur coat, a pair of beautiful Rembrandt table lamps, and a trip to the Virgin Islands. My dad made sure my brother and I got to go along on the trip, where we were entertained by a member of the Duke Ellington orchestra. Perhaps this is where my brother and I both developed our love of jazz.

In the mid-1960’s, Daddy decided he wanted to learn to fly. Cecil Lawing was his instructor, and Cecil had a Cessna 175. Daddy loved flying, but my mom said it would be life or death before she got in the plane with him. Death it would be, as my mother’s cousin was dying of kidney failure and family members were being tested for the possibility of transplant. Daddy loved flying and soon would purchase a 1956 Cessna 172, N7214A, which would become my plane as soon as I got my license.  We spent most Saturdays out flying.  One of Daddy’s favorite stories was taxiing in at the airport in Myrtle Beach and being asked, “What are you doing flying Suzanne’s airplane?” I was in trouble for that, because he knew then I was flying to the beach when I was supposed to be in school.

Southern Film Extruders continued to expand and Daddy eventually took the company public.  He had locations in Florida and in New Orleans, so he was gone even more than ever. My parents divorced and my relationship with my dad changed. Divorce is not easy on adult children, either, and I was often put in the middle by both of my parents. Daddy and I would be estranged for months at a time but if I needed him, he was there. I never doubted his love.

Daddy moved to Palatka in the 1980s and eventually became an active member of the Carraway Seventh Day Baptist Church. He and his late wife, Beverly Marlowe, began the “Joy In the Morning” ministry for unwed mothers, which provided assistance for more than 100 single mothers. On a trip to Haiti, he found his passion and learned to build artificial legs in order to serve Haitiian amputees. Over his 20 years of travel, he even had “repeat customers” whose original legs had worn out or been outgrown.  He began his travels to Haiti when “Baby Doc”B96D2A1E-F9D8-4984-9ACD-FC01B69EB444.JPG Duvalier was in power, and was in Haiti when Aristide was overthrown by military coup. None of this dampened his passion for Haiti, nor did the violence he witnessed frighten him.  His faith and his passion were stronger than the fear. Daddy would more than 50 mission trips to Haiti and three to the Dominican Republic, bringing artificial limbs to needy recipients. My dad loved Haiti and the Haitian people.

Since mid-July, I’ve watched my dad wither away. I’ve sat at his bedside and helped him fulfill his final wishes, except for training his replacement in Haiti.  That I could not do, but I tried.  He was just too frail and I couldn’t get the young man here fast enough.  By mid-September, Daddy was barely eating and walking was a struggle. The phone call on October 10 was no surprise, but I know now he is at peace.  Even my mother made the statement that no one had greater faith than Webster Marlowe.

We’ve planned a memorial service for Saturday, October 29, 2016, at the American Legion Post 45, in Palatka, FL, at 3:00 p.m. ET, and we’ve asked people to consider contributing to Haitian ministries through Bethlehem Ministry, http://www.bethlehemministry.org, PO Box 48387, Athens, GA 30604.

 

A Pecan Waffle with Honey

“You’re here to protect me,” he said, barely lifting his head. “Yes, Daddy. You’ve been here for me throughout my entire life, and now I’m here for you.” Except I can’t do anything.

I’m beyond wondering whether I’ve said my final goodbye to my dad. I thought I said my final goodbyes when he was in ICU in July, then when he was in the hospice care center the next weekend. After a trip to see his sister, one he really did not need to take, he had to be readmitted to the inpatient hospice. He’s been there for the past 8 days and they can’t seem to regulate his medications, so I treasure every minute that I have with him. We’ve had our challenges over the past 40 years, but he’s been there when I needed him.   Now it is my turn to be there for him.

Daddy didn’t know where he was, but he knew he was safe. I was there.

My dad has had difficulty swallowing since he fell in July, but on Saturday he asked for a pecan waffle with honey. The nurse told him he could have soup, that they had no waffles of any kind. He was insistent; he wanted a pecan waffle with honey. I asked her whether she had a toaster, if I could find some at the grocery store. She gave me a disapproving look and said I could probably use the one in the kitchen. My father stated, again, “I want a pecan waffle with honey. I don’t want one from the grocery store.” The nurse patiently tried to explain that the hospice didn’t have any and that he couldn’t eat a waffle. Maybe patiently is a stretch; let’s just say she was polite. She offered yogurt, pudding, or soup. My dad raised his head, and for the first time I got a final glimpse of the man my father once was. “Do you not believe in satisfying your customers?” I burst out laughing then sent my husband to Huddle House for a pecan waffle with honey.

Bob came back with the waffle and the nurse walked out of the room in a huff. I poured the melted butter on it and then squeezed the honey from the packets, as my dad smiled and inhaled the fragrance of the warm pecans and honey. For a few minutes, he was happy. The nurse came in, asked me if I knew what I was doing. I told her I was trying to make my dad as happy as possible, for whatever little bit of time he has left. I knew he could choke but seriously? Shouldn’t he be allowed to enjoy whatever little bit of life he has left? The nurse scowled and walked out again. My dad didn’t eat, however, but he was clearly thinking about it. As soon as I left the room, the nurse through out the pecan waffle with honey.

My dad is dying. And all I can do is be there.

An Excellent Adventure

My husband turned 75 this year and we are celebrating this milestone with 75 adventures. We’ve chosen to include the intentional and unintentional adventures, both good and challenging. This liberal definition of adventure has resulted far more adventures than we anticipated and we’re up to 68, but this approach to the year has just been so much fun.

Our most recent adventure was truly outstanding and this one was deliberate. Bob spent almost his entire military service at Vance Air Force Base as an instructor pilot in Enid, Oklahoma, and he has always wanted to go back. Vance AFB is still a training base and they still fly the T-38 Talons and the T-6 Texans. Thanks to the base Public Information Officer, Bob’s dream came true.

We set out at 9:30 p.m. on Wednesday on a Delta flight to Tulsa. Pass-riding is its own adventure, but we were cleared early and we had first class seats. Even better, we sat together! The driver of the rental car van couldn’t believe we were going to Enid, but I reminded myself this is BOB’S DREAM COME TRUE, not mine.

Anyway, we made it to the Hampton Inn and settled in. I work remote but I can get my 10-12 hour workdays in most anywhere. Bob was like a kid at Christmas. He kept running to the window to look at the planes, so I sent him out to explore the town on his own. After all, I was at work and I had meetings ALL DAY LONG.

Lt. Schroeder arranged an absolutely fabulous tour of the base, including simulator time. I went over on my lunch hour to see the sim and watch Bob fly. He surprised me by giving me part of his sim time, so I got to takeoff, fly around, do some aerobatics, and land. It was fun to be back at the controls of a jet again, even if it was a simulator.

I packed up the mobile office and we drove back to Tulsa last night to catch a 0600 flight home this morning. It is good to be back, with memories of another REALLY EXCELLENT adventure!

It’s good to be home.