Taking Care of Your Own Economy

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I met with the financial advisor whose company holds my IRA (from a job I had a long time ago) a few days ago. We meet annually to discuss how the account is doing, if/when some investments should be changed as well as a general overlook of our finances. It’s good to have a financial professional to go to for knowledgeable advice especially with an IRA or 401K or other long-term investment.

But when it comes to your family’s own finances, you’re probably on your own. With everything that’s going on right now you’re probably more than a little concerned and you have every right to be. But what can you do?

It’s sad to say but the more funds (aka money) you have the easier it would be to survive most crisis situations. Those struggling to make ends meet will have a more difficult time during an economic collapse.

Having a savings plan, and an emergency fund, as well as some cash will help buy your family time to get/remain stable while others around you flounder.

If you’re one of those with less than $1000 in savings know that it’s time to get that fixed.

Start by planning your budget. Do this on paper so you can actually SEE where the money goes. Write down ALL your expenses. This means not only your rent/mortgage, power/light/internet/phone as well as what you spend each month on groceries including stops at fast food restaurants, drive thrus and convenience stores for snacks and drinks.

Do whatever you can to slash some of those bills. For the vast majority the best place to cut in the budget is the grocery bill (and eating out). That $2 you spend on a drink at ‘a drive thru’ is $40 a month (given you don’t go there on the weekend). What’s a coffee at the fancy coffee place cost you? Multiply that by the number of times you visit in a week x4. Surprised? Those funds can go a long way to creating an emergency savings account.

Maybe you can eat beans for a meal one night a week. Maybe take your own sandwich from home. The savings really add up.

canary beans
canary beans

Once you begin to have a little put back leave it alone. Don’t buy a TV. Don’t buy a new jacket or shoes just because they ‘called’ you. No splurges. Once you hit $1000, don’t stop. Just set a new higher goal.

If you’re lucky enough to still have gainful employment AND your employer offers a 401K plan then begin or add to that plan. Do this even if all you can afford is 1%. Then raise your amount next time you get a raise. Over time you’ll amass some funds for retirement rather easily, especially if your employer matches your contribution in any way.

Pay off your debt as fast as you can. There are many methods to do so. Some suggest tackling the bill with the highest amount. For many people tackling the smallest bill often is an easier goal and once paid off gives you some piece of mind and some encouragement to tackle the next bill. Once you’ve paid off the little one, apply what you were paying on the ‘paid off’ bill along with your regular payment to the next goal and you’ll get there before you know it.

Now that you’re paying off your debt don’t acquire new debt! You really don’t need a new bigger fancier tv/stereo/gameset as long as the one you have functions. Truly you don’t. Take care of what you have and make it last.

Have some cash at home stashed away for an emergency as well. If there’s no power because of a storm, a car hits a power pole that messes up power for miles, or other peril you might not be able to get what you need. When the power is out, the credit card terminals won’t work. You can’t buy food or gasoline or other essentials unless you have cash.

Start planning and start saving today for a better tomorrow for you and your family.