Today, most of the debt is gone, but the lusher life of the boom years is a distant memory. "We had credit cards and we didn't worry about a thing," says Madeleine, 55.
In the U.S., debt per adult soared 54 percent in the five years before the crisis. Then it plunged, down 12 percent in 4 ½ years, although most of that resulted from people defaulting on loans. In the U.K., debt per adult fell a modest 2 percent, but it had jumped 59 percent before the crisis.
Even Japanese and Germans, who weren't big borrowers in the years before the crisis, cut debt — 4 percent and 1 percent, respectively.
"We don't want to take out a loan," says Maria Schoenberg, 45, of Frankfurt, Germany, explaining why she and her husband, a rheumatologist, decided to rent after a recent move instead of borrowing to buy. "We're terrified of doing that."
Such attitudes are rife when it has rarely been cheaper to borrow around the world.
"A whole new generation of adults has come of age in a time of diminished expectations," says Mark Vitner, a senior economist at Wells Fargo, the fourth-largest U.S. bank. "They're not likely to take on debt like those before them."
Or spend as much.
After adjusting for inflation, Americans increased their spending in the five years after the crisis at one-quarter the rate before the crisis, according to PricewaterhouseCoopers. French spending barely budged. In the U.K., spending dropped. The British spent 3 percent less last year than they did five years earlier, in 2007.
High unemployment has played a role. But economists say the financial crisis, and the government debt crisis that started in Europe a year later, has spooked even people who can afford to splurge to cut back.
Arnaud Reze, 36, owns a home in Nantes, France, has piled up money in savings accounts and stocks, and has a government job that guarantees 75 percent of his pay in retirement. But he fears the pension guarantee won't be kept. So he's stopped buying coffee at cafes and cut back on lunches with colleagues and saved in numerous other ways. "Little stupid things that I would buy left and right ... I don't buy anymore," he says.
Even the rich are spending cautiously.
Five years ago, Mike Cockrell, chief financial officer at Sanderson Farms, a large U.S. poultry producer in Laurel, Miss., had just paid off a mortgage and was looking forward to the extra spending money. Then Lehman collapsed, and he decided to save it instead.
"I watched the news of the stock market going down 100, 200 points a day, and I was glad I had cash," he says, recalling the steep drops in the Dow Jones industrial average then. "That strategy will not change."
The wealthiest 1 percent of U.S. households are saving 30 percent of their take-home pay, triple what they were saving in 2008, according to a July report from American Express Publishing and Harrison Group, a research firm.
After years of saving more and shedding debt, the good news is that many people have repaired their personal finances.
Americans have slashed their credit card debt to 2002 levels. In the U.K., personal bank loans, not including mortgages, are no larger than they were in 1999. In addition, home prices in some countries are rising.
So more people have the capacity to borrow, spend and invest more. But will they?
Sahoko Tanabe of Tokyo, 63, lost money in Japan's stock market crash more than two decades ago, but she's buying again. "Abenomics," a mix of fiscal and monetary stimulus named for Japan's new prime minister, has ignited Japanese stocks, and she doesn't want to miss out. "You're bound to fail if you have a pessimistic attitude," she says.
But for every Tanabe, there seem to be more people like Madeleine Bosco, the Californian who ditched many of her credit cards. "All of a sudden you look at all these things you're buying that you don't need," she says.
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