10 Depression Era Money Saving Strategies That Would Make Our Grandparents Proud (2024)

FAQs

What were some ways people saved money during the Depression? ›

To save money, families neglected medical and dental care. Many families sought to cope by planting gardens, canning food, buying used bread, and using cardboard and cotton for shoe soles.

Many people turned to farming, and grew the food themselves, like fruits, vegetables, cattle, chickens, sheep, and hogs. Many people would can their food so that it would last longer. Some people chose to hunt for their food.

President Franklin D. Roosevelt's "New Deal" aimed at promoting economic recovery and putting Americans back to work through Federal activism. New Federal agencies attempted to control agricultural production, stabilize wages and prices, and create a vast public works program for the unemployed.

The Federal Reserve could have prevented deflation by preventing the collapse of the banking system or by counteracting the collapse with an expansion of the monetary base, but it failed to do so for several reasons. The economic collapse was unforeseen and unprecedented.

In all, 9,000 banks failed--taking with them $7 billion in depositors' assets. And in the 1930s there was no such thing as deposit insurance--this was a New Deal reform. When a bank failed the depositors were simply left without a penny. The life savings of millions of Americans were wiped out by the bank failures.

Mobilizing the economy for world war finally cured the depression. Millions of men and women joined the armed forces, and even larger numbers went to work in well-paying defense jobs. World War Two affected the world and the United States profoundly; it continues to influence us even today.

Farm Families and the Great Depression

Farm families were often better suited to weather hard times than town residents. Farmers could grow their own food in large gardens and raise livestock to provide meat. Chickens supplied both meat and eggs, while dairy cows produced milk and cream.

Despite all the President's efforts and the courage of the American people, the Depression hung on until 1941, when America's involvement in the Second World War resulted in the drafting of young men into military service, and the creation of millions of jobs in defense and war industries.

Roosevelt tried to stimulate the economy with a range of incentives including Roosevelt's New Deal programs, but ultimately it took the manufacturing production increases of World War II to end the Great Depression.

The best performing investments during the Depression were government bonds (many corporations stopped paying interest on their bonds) and annuities.

What are the 8 causes of the Great Depression? ›

Among the suggested causes of the Great Depression are: the stock market crash of 1929; the collapse of world trade due to the Smoot-Hawley Tariff; government policies; bank failures and panics; and the collapse of the money supply.

The worldwide economic downturn known as the Great Depression began in 1929 and lasted until about 1939. It caused steep declines in output, severe unemployment, and acute deflation and led to extreme human suffering and profound changes in economic policy.

Farm Families and the Great Depression

Farmers could grow their own food in large gardens and raise livestock to provide meat. Chickens supplied both meat and eggs, while dairy cows produced milk and cream. Many women had sewing skills and began producing much of their family's clothing.

Millions of Americans used credit to buy all sorts of things, like radios, refrigerators, washing machines, and cars. The banks even used credit to buy stocks in the stock market.

The NRA (National Recovery Administration) sought to stabilize consumer goods prices through a series of codes. Through employment and price stabilization and by making the government an active partner with the American people, the New Deal jump-started the economy towards recovery.

During the Great Depression, money became worthless because there was too much of it in circulation and not enough goods and services to purchase. This led to a decrease in demand for goods and services, which in turn led to deflation, or a decrease in prices.