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Checks and Balances
By Advisor Perspectives
- Checks and Balances
- The U.S. Faces Daunting Deficits
- U.S./Asia Trade Frictions Are Not New
I still balance our checkbook every month. I realize that I am in the minority; only a third of Americans use checks regularly and only 20% reconcile their personal ledgers with their bank statements. But I’ve always found the discipline useful. At first, it helped ensure that we remained solvent (which was touch-and-go for a while); today, it keeps me in close touch with trends in revenue and expenses.
Some politicians have drawn parallels between public budgets and household checkbooks, and suggested they be managed in a similar fashion. The comparison is not entirely appropriate: households can’t print money or borrow immense sums at low interest rates. Government incomes and costs don’t have to be aligned every month; such a strategy would be ruinous if pursued during a recession.
Read more at Advisor Perspectives.
Photo: Ken Teegardin