Preferred Financial Services

Preferred Financial Services, Inc reviews and discusses the most recent Household Debt Service and Financial Obligations Ratios data released by the Federal Reserve …

Andover, Massachusetts April 26th 2010—Preferred Financial Services has reviewed the most recent data released by the Federal Reserve in regards to household debt ratios and continues to see signs that the economic recession has changed consumer habits in the short term. The verdict on any long term change is still up for discussion as not enough time has passed for accurate predictions to be made.

As expected, the household debt (mortgage and consumer debt) to disposable personal income ratio continues to drop, hitting a 9 year low of 12.6. This means that 12.6% of all the disposable personal income of the average American is going towards debt service payments. This ratio went as high as 13.92 in the first quarter of 2008. This was the peak of the economic bubble where people were maximizing their debt payments to sustain a lavish and unsustainable lifestyle. As the economy started to falter and household income and spending took a hit due to property value plunges, foreclosures, job losses and income insecurity, this ratio has been on a steady decline.

This decline proves that Americans have changed their spending habits due to the economy, something that was not a foregone conclusion when the economy first started to slow down. The question everyone is asking now is if the old habits will reappear once the economy improves or if Americans have actually changed how they live and manage their finances. If we do revert back to our old spending habits, our economy might improve quicker due to higher consumer spending and thus economic growth. However, that means we didn’t learn from our past mistakes and are setting ourselves up for a repeat of the disaster of 2008. If it is a permanent shift in consumer spending, past assumptions about the American economy and the strength of consumer spending will not be true anymore. Consumer spending has been the engine of growth for the American economy since the end of World War 2, are we witnessing a fundamental shift of the American consumer? Only time will tell.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit: www.pfsdebtrelief.com

Contact:

Stephan Tavernini

stavernini@pfs1.net

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Preferred Financial Services, Inc reviews and discusses recent financial data on consumer credit released by the Federal Reserve…

Andover, Massachusetts April 20^th 2010 – Preferred Financial Services has reviewed the most recent consumer credit report released by the Federal Reserve in early April and has found some interesting and thought provoking information in it related to how Americans are spending their money in this economy.

As expected, with the still faltering economy and high unemployment rate consumer credit has decreased quite substantially as American families are still worried about the economy and their personal finances. This drop in credit tends to signal that consumers do not believe the economy in general and the job market in particular has turned the corner completely. If they did, the credit use by consumers should be trending upwards not downwards as consumer spending increases.

The numbers also show that Americans are relying less and less on revolving credit and more and more on non revolving credit which once paid off can not be used again. Typical examples of this are car loans and student loans. Revolving credit, which is typical credit card debt, dropped an astounding 13% in February. Non revolving debt only dropped 1.3% on an annual basis in February. This disparity leads us to say with a high degree of certainty that Americans continue to limit their personal non essential expenses in these tough economic times.

The report goes on to state that total consumer debt has decreased by close to 40 billion dollars from January to February. Before this recession Americans had peaked their personal debt at close to 2.6 trillion dollars in the 4^th quarter of 2008. As the economy soured and Americans reigned in their debt, it has dropped to 2.45 trillion. The continued drop also signals that Americans are paying off their debt and not creating new debt. This is very important as it could signal a fundamental shift away from living on credit to a more responsible financial landscape.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit: www.pfsdebtrelief.com

Contact:

Gabriel Tavarez

gtavarez@pfs1.net

866-992-7400

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