smart spending

4 personal stories of the Great Recession

Five years after the Great Recession, Jennifer Butz still makes out a weekly budget. She writes down how much she gets paid, subtracts her bills and leaves $50 for gas and groceries. She takes her lunch to work and never buys coffee or on-the-go breakfast.

"It's worth the wait for things. I consider whether I really need or I really want something," says Butz, 35, who lost her job, her car, her house and filed for bankruptcy in the last four years.

"I think I'm doing pretty good on my own now," she says.

The financial scars of the longest post-World War II recession remain etched in many Americans' everyday lives. Like Butz, many still hold on to the cost-cutting habits that kept them afloat after job losses, foreclosure and bankruptcy, as they regain financial security. Some are teaching younger generations these lessons. Still, some have yet to recover.

By economists' definition, the Great Recession ended in the middle of 2009. Since then, the unemployment rate has dropped to 7.3 percent, down from 10 percent in October 2009. Home prices and sales are finally showing year-over-year gains. And consumer spending last year surpassed the peak recorded in 2008.

Still, more than 19 million people remain without a job or are underemployed. Many Americans still feel uncomfortable with their savings. And many largely remain cautious about borrowing money.

"Consumers have realized that buying a sweater you can't afford today on credit isn't a good idea," says Amy Cutts, chief economist at Equifax. "It's much better to save up the money and buy it later."

For an individual's personal finances, that seems financially savvy if a bit conservative. For the economy, especially one that is largely dependent on Americans' penchant for spending, lingering frugality means a sluggish recovery.

"The trends we see today may not foretell what will happen in the future," says Antoni Guitart, director of research and consulting at TransUnion. "The big key is how robust the improvement in consumer confidence is. If it remains volatile, it's harder to anticipate what it will take to get consumers to spend on credit."

These four stories in the wake of the Great Recession show how it still affects the daily lives of Americans.

The financial crisis of 2008 changed the way money pros approach their work. Here's how.

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