Recession's Long Gone, but Average Income Isn't Budging

Advertising Age reports:

Americans officially have been living beyond their income for one year. The nation's personal-saving rate --income minus consumption and interest payments -- turned negative in April 2005 for the first time since 1933, according to the Bureau of Economic Analysis.

The Fed survey found 56% of families are setting aside savings. It also asked consumers how long they typically plan for key saving and buying decisions. The richer households are, the longer the planning period. Families in the bottom 50 percentiles of wealth live in the short term: 45% of those families plan key money decisions a few months to a year out. Among the top 10 percentiles, more than 60% plan saving and consumption decisions at least five years out.

Can the negative savings keep going on for years? We doubt it.Something has to give.