The Vital Role You Play In The Economy
We are all contributing to the economy one way or another, either through taxes or shopping. We all have our part to play in keeping things going.
The financial industry relies on us
If we stopped banking, spending money, going to work, or any other activity which involves money being circulated then the whole economy as we know it would collapse.
This would cause unknown chaos and it’s something which governments and financial experts have been trying to prevent. This is evident by the countless bailouts, tax increases, benefit reforms, and economic stimulation done by the government
Our contribution starts with the bank
The banks are the financial industries main point of contact with the general public. The bank is where we get paid, where we place or savings, where we get our loans/ credit cards/ mortgage/ insurance. There are very few people who have never had any dealings with a bank.
The banks generate income from charging interest and fees; as long as we keep paying them then the banks continue to turn a profit.
Banks keep money circulating, whether that is through deposits, lending, or allowing people to make purchases. As long as money is exchanging hands then the economy keeps flowing.
We work and pay taxes
If you earn enough of an income then you will be required to pay some level of tax. These taxes are then used to pay for things such as education, emergency services, council services, etc.
As much as we all begrudge paying them, they do play an important role in our society.
The unemployed will still pay some level of tax, even if it’s only VAT on purchases. They may also need to pay other types of tax depending on other sources of income. However, if their only source of income is via welfare benefits then this is unlikely to be the case.
How important is shopping?
It doesn’t matter if we are shopping for leisure or for necessity, shopping is a huge part of our lives. It is also probably the most direct way the general public pumps money into the economy.
The way we shop is changing, we are more likely to shop online and seek out bargains. This has had a major impact on the retail industry and they have had to adapt. Those that didn’t adapt or adapted too late have paid the price.
The economy and me
There are of course other ways you may contribute to the economy, you could be a business owner or a landlord. These are only a few ways in which the majority of the population. Whatever your contribution, it doesn’t change how important a growing economy is.
This is why the economy has been such a hot topic recently. The financial crash has bought the economy into the limelight and people are suddenly taking notice. The media is continuing to report whether we are in recovery or not.
One thing is certain, that money is the foundation as to which our society is built on.