How To Protect Yourself As The Economy Crumbles

[No DUplicitous DUpe]

How To Protect Yourself As The Economy Crumbles
(posted with permission from: http://sane-ramblings.blogspot.com/2011/09/how-to-protect-yourself-as-economy.html)

Across the world, manufacturing is slowing or declining and unemployment is mounting as are home foreclosures. In Washington we have skyrocketing debt, a falling dollar and political gridlock while in Europe, the debt crisis threatens the European Union as the economies of Portugal, Ireland, Italy, Greece and Spain are already crumbling. Japan is struggling to recover from the earthquake and tsunami while even in China, manufacturing is slowing and a real estate bubble is brewing. If you haven't yet taken protective action, please start now. And if this piece offends you, I apologize for its intent is not to upset you but to help you. Here are 7 steps you can take:

1) Slash your overhead. Pay down your credit card balances for the interest costs can eat you alive. If you are already buried in credit card debt, contact those credit suppliers and negotiate a payment plan and possibly even a forgiveness of some of that debt. And if you own a home, contact your local government to reduce your property valuation, which will drop your taxes. If you must sell that home, consult a real estate professional but price it to sell now, as in most areas, prices are falling. Run a yard sale to convert to cash things you no longer use. What doesn't sell donate to charity, which will help someone else get cheaply something they need and it will give you a tax deduction.

2) If your credit is still strong and you own a home with equity in it and a mortgage on it, and intend to stay, if you haven't yet done so, please refinance that mortgage on a 30 year fixed rate basis taking advantage of the lowest mortgage rates since the 1950's. If on the other hand, you must leave your home, perhaps you can move in with family or friends and pay them some rent. This is not a pleasant choice but it will slash your costs and provide income to someone near and dear to you.

3) Set up a part-time business to make money on the strongest of your skills. This will not only give you extra income but a paycheck in the event you lose your job. One such business, especially for underpaid or unpaid mothers could be to become licensed in childcare and offer a childcare service.

4) If you are fortunate enough to have a full-time job, cross train so that you have more to offer your employer. And take classes to enhance your job skills.

5) To cut your food bill, become a coupon clipper, join store clubs and also shop the discount giants like Costco and Sam's Club. And locate your nearest food bank. To reduce your medical costs, join a pharmacy discount club at Wal-Mart, CVS, etc. or negotiate lower prices with a small druggist. Negotiate as well with your doctor and your local hospital. In hard hit areas, hospitals will often provide a huge discount if you pay cash at the time of your treatment.

6) Barter. For example, if you grow fruits and vegetables, trade some of your bounty for what you need such as to compensate someone to paint, fix or do other handyman work for you.

7) No matter what happens, please enjoy each day of your life. It doesn't cost anything to smell a rose or to feel the sunshine or to check out a good book or movie from a library. And offer others a smile and a helping hand. That too costs nothing and will help to uplift the world around you. Together we will eventually get through this financial mess engulfing us all.

[Odin2005]

1. K&R

[fasttense]

2. I would add - start raising your own food.

Plant an ugly garden, you don't always have to keep it weed free and bug free to eat the produce.

Get some chickens. Raise a few sheep. You would be surprised how cheaply you can raise healthy, happy animals that you can eat if food becomes too expensive to buy.

[No DUplicitous DUpe]

4. The garden is a good idea...

But if you own enough land to raise sheep, I'm guessing you can still afford to buy chicken when it is on sale at the grocery store.

[Bonhomme Richard]

3. I can't go near re-financing the house. I work for myself and...

people like me are "untouchables" as far as a bank is concerned. On top of that I am struggling to keep the business afloat.

[Broderick]

10. ditto

[femrap]

5. I watch the electric and water bill.....

I keep A/C at 78 degrees and in the winter I set it at 65 degrees. I wear thick socks and a warm sweater. I use a small electric blanket (twin size is all that is needed for a double bed) in the winter so at night I set the temperature at 62 degrees. And in the summer...I wear tank tops and shorts. I also place small fans on the floor...that's where all the cool air is. I have one fan on me while I'm at my desk, another where I sit on the sofa, another in the bathroom (helps hinder mold and mildew) and one on me at night while I sleep. (I hate summer). I hate giving Big Utility one extra dime! I turn out lights when I'm not in that room.

I turn off the shower while I'm lathering.

I roll up old towels and place them on the window sill in the winter...I live in an apartment and Goddess knows, the landlords could give a sh*t if my utility bills are high.

And when I use the oven, I make sure to cook at least 2 things, such as teriyaki chicken breasts AND a beef roast. Then I cut up into individual servings and freeze. Most of the time I cook 3 things....a pork roast with kraut. And the Crock Pot is great. Makes several servings of stews that I can freeze and uses little electricity.

Hope this gives people some ideas....I grew up with my grandparents on their farm and they lived through the The First Great Depression...they taught me well!

[No DUplicitous DUpe]

6. So what does your electric bill average?

Those are some helpful ideas, except for me, I'd rather just take a quick shower that shut off the water for 20 seconds...by the time I got the right temperature again, I would have wasted more hot water than I saved.

[femrap]

7. My water stays at pretty much the same

temp when I turn it back on.

I live in a 4 seasons climate....so in the spring/fall, my electric bill can be $20 to $30/month. We had a horribly hot July this year and it was $73. In August, it was back to $50. This is for a one bedroom apartment....that isn't terribly well-insulated, but better than some I've lived in. Winters are the worst....but I subsidize w/ soy candles at night....really heats up a small room and I enjoy candle-light when I sit down to veg out for a couple of hours of TV.

My water bill is about $16/month. And I have the water heater set at 105 degrees....low.

[No DUplicitous DUpe]

11. You do a very good job saving energy...

..and money, too!
:hi:

[femrap]

14. I just hate giving

Corporations $$$.

[dixiegrrrrl]

8. Refinancing BAD idea

if you have more than 5 years of equity/amortization in the house.
Byy that point, you are paying less and less interest, and if you re-fi, not only will you be paying fees, you will be starting all over with interest schedule
PLUS
a re-fi is a 2nd mortgage which is not usually discharged in bankruptcy.

Them is facts, not advice, just facts.

Good idea: paying down mortgage as fast as possible if you can afford to. Even adding an extra 50.00 a month will add up over time saving a lot in interest costs.

Bankrate dot com has a handy tool that can show you how much you save by various payment options.
You plug in the interest, the balance of the loan, and play with the numbers. Very educational.

[Blue_Tires]

9. kick for #7

[kctim]

12. Sorry

but the BEST way to protect yourself for a crumbling economy is to do it BEFORE it crumbles.

[taught_me_patience]

13. Impractical and poor advice for dealing with a recession

A loss of a job usually entails a cash flow problem... so why would you possibly want to use up valuable cash paying down debts? For example, if you pay down your mortgage an extra $50 each month, you may shorten the loan term, but you've now spent an extra $50 that could have been saved. If you get laid off... the mortgage will still be the same amount, but you have less savings to draw on.