Each year, the U.S. Congress sets a federal budget in the trillions of dollars. Very few individuals, ourselves included, can really wrap their minds around just much money that truly is, so we’ve broken down the 2011 federal budget into relatively simple terms to help us all gain a little added perspective1:
- U.S. Income: $ 2,170,000,000,000
- Federal Budget: $ 3,820,000,000,000
- New Debt: $ 1,650,000,000,000
- National Debt: $14,271,000,000,000
- Recent Budget Cut: $38,500,000,000 (roughly 1% of the overall budget)
It often helps to reduce these numbers down into figures we can actually relate to. Let’s remove eight zeros from the figures above and pretend this is the household budget for “the fictitious Jones family.”
- Total annual income for the Jones family: $21,700
- Amount of money the Jones family spent: $38,200
- Amount of new debt tacked onto the Jones family credit card: $16,500
- Outstanding balance on the credit card: $142,710
- Amount cut from the budget: $385
So, in effect, last month the Jones family sat down at the kitchen table and agreed to cut $385 from its annual budget. What family would cut $385 of spending in order to solve $16,500 in deficit spending? Some may say it’s a start. None would argue it’s a solution.
Now after years of this, the Jones family has $142,710 of debt on its credit card (the equivalent of the national debt). You might think the Jones family would recognize and address this situation, but it doesn’t, and neither has Congress.
With the enormity of debt facing our nation and the uncertainty surrounding the future of programs such as Social Security and Medicare, there has never been a more important time to create a sound financial strategy for the days ahead. We say it time and time again to our valued clients, but even in the midst of such volatile economic times, some things can still be certain. You can still put solutions in place to help ensure that your retirement income is secure, lasts throughout your lifetime and helps protect you against future inflation and rising healthcare expenses.
If you or anyone you know would like to visit about putting such solutions in place, simply give us a call today! We may not be able to depend on Congress to right the financial wrongs of the country, but we can put strategies and solutions in place to help ensure YOU are protected – regardless of what’s to come!
1 Office of Management and Budget. www.gpoaccess.gov/usbudget/fy11/pdf/budget.pdf. August 1, 2011.