I just read a great article by Kirstin Downey of The Washington Post. It's called Basics, Not Luxuries Blamed for High Debt. I mostly agree with her assessment of that problem; that what’s got middle class citizens over the debt barrel is the rising cost of living for life’s basics and not for luxuries. I say mostly because I still believe that even though many families may not be spending on luxuries, they are certainly overspending in general. For example, they might be struggling with paying their health insurance but cannot resist purchasing meals out, an iPod, more clothes than they need, a new car, etc. See what I mean? She got it mostly right. Here’s the article:

http://www.alifestylerevolution.com/community/index.php?showtopic=13

Yes indeed, the costs for health insurance, housing, higher education, childcare, energy, transportation, etc. are going through the roof. According to Commonwealth Fund Biennial Health Insurance Survey, the middle class is definitely on a slippery slope when it comes to being able to afford health insurance. Here’s what they say:

· “7 percent of “high-income” adults in the U.S (household income of $60K or more) in 2005 went without health insurance for some or all of the preceding year, up from 4 percent in 2002

· 53 percent of low-income earners (less than $20K) lacked insurance last year, up from 49 percent in 2001

· 41 percent of moderate-income adults ($20-$39,999K) lacked insurance last year, up from 28 percent in 2001.”

This indicates moderate-income adults are losing ground the fastest with a 13% increase from 2001 through 2004. I suggest that this health insurance data acts also as a strong indicator for other ways the middle class is losing ground as they attempt to keep up with housing, higher education, childcare, energy and transportation costs.

That said, the solutions offered in the above article completely lack teeth. Why? Given the cultural expectations of looking good and keeping up with the Joneses, individuals and families are highly unlikely to downsize voluntarily in the ways mentioned, even if it’s in their best interest to do so. Sadly, all too often it takes the “frying pan over the head” wake-up call for people to make real changes.

Plus, instead of using statistical evidence to warn people to change their lifestyle, it is far more useful to clarify data showing what is behind these statistical downward trends. Why is this happening in the first place? Information is power. When people are empowered with information that taps into the root cause of the problems at hand, they are more likely to advocate proactively for themselves by buying-into genuine solutions.

But even when offering the strongest solutions based on the root cause of today’s financial problems, resistance to implementing them will exist. When it comes to money and lifestyle issues, most everyone will be hard pressed to do what they know is best because of the brainwashing by the likes of “Life takes Visa” and “Live Richly”. Common cultural expectations and the obstacle they present must first be addressed for the middle class citizen to want to change their ways in exchange for greater quality of life.

Susan Boskey is author of the book, The Quality Life Plan™: 7 Steps to Uncommon Financial Security. Her business, Redefining Success, LLC, specializes in breakthrough personal finance products and services that address the unique economic challenges people face today.