The most important lesson for individuals who have emerged from the world economic crisis is to live within their means.

The Government needs to do more to educate Jamaicans, on saving and building wealth for themselves. While debt reduction and economic models are important to Jamaica's long-term prosperity, increasing the savings rate among the population would go a long way in the recovery process. It is a proven fact that countries with a gradually increasing saving rate do better economically than countries that don't, case in point China and India.

Family units in countries with high saving rates have lower debt levels, which result in an increase in assets/money available for investment. This could translate in more small businesses being started in Jamaica, which would be valuable in lowering the high levels of unemployment. This, to me, is a better strategy of getting people back to work than begging foreigners to invest in Jamaica, and when they do, bending over backwards to make it easy for them to repatriate their profits.

With the release of news about Jamaica's squatter situation, and the high levels of unemployment, one can assume that a mortgage and credit-card debt is not a hindrance to savings for the majority of Jamaicans. So the question remains, why is Jamaica's saving rate not gradually increasing.

Saving account balance

The answer is consumption. Too many of our countrymen and women live beyond their means, they don't save and a significant part of their earnings is spent on wants not needs. A notable example is phonecards. If every Jamaican who owns a cellphone spends $100 less per day on credit and invest said amount at a modest five per cent annually for 10 years, they would have a saving account balance of approximately $459,093. While this is not a large sum by any stretch, how many Jamaicans today have a saving account with close to half a million dollars in the bank, not many.

I am, etc.,

AUDLEY GILPIN Jr

audleygilpin@yahoo.com

Toronto