Using credit to buy consumer goods benefits the economy by stimulating production. Increased production creates more jobs and lenders profit by charging interest. The overuse of credit, however, hurts the individual and the national economy.
Savings are necessary if the economy is to grow.
Too much consumer credit puts a drain on personal savings. Banks use these savings to finance loans to business and agriculture. Many economists, business people, and private citizens believe that Americans are using too much credit. Total personal debt in the U.S. has doubled since 1975. At the same time, many people who once considered themselves well off were filing for bankruptcy.