A nation living beyond its means or is it something having to do with changes in the economy?

The bottom line is Americans aren't saving much money, don't put money away for a rainy day, and are living "hand to mouth" as they used to say with 76% living virtually paycheck to paycheck.

CNN Money:

Fewer than one in four Americans have enough money in their savings account to cover at least six months of expenses, enough to help cushion the blow of a job loss, medical emergency or some other unexpected event, according to the survey of 1,000 adults. Meanwhile, 50% of those surveyed have less than a three-month cushion and 27% had no savings at all.

"It's disappointing," said Greg McBride, Bankrate.com's senior financial analyst. "Nothing helps you sleep better at night than knowing you have money tucked away for unplanned expenses."

Even more disappointing; The savings rates have barely changed over the past three years, even though a larger percentage of consumers report an increase in job security, a higher net worth and an overall better financial situation.

I think a lot of people are just ignorant about how to handle money. They don't budget. They splurge. They have impulse buys. And they get to the end of the month and wonder where it all went.

Also, I don't think there's any doubt that a large percentage of Americans have more house than they can afford. We saw this in the housing meltdown. Too many people take on too much mortgage for their income. And mortage companies have relaxed qualifications so that more people can afford more expensive houses.

It doesn't help that new jobs being created don't pay as much as the old jobs that were lost. We may not be becoming a poorer nation statistically, although that may be true to a small extent. The real problem is psychological - our inability to discipline ourselves into buying what we can afford and spending judiciously.