I believe we need to downplay the media attitude of Chicken Little’s “the sky is falling”. All that happens is that we get emotional and become too stressed, affecting our relationships and daily activities. (Poor moods,depression,apathy)
This isn’t an ostrich move – putting your head in the sand and pretending the world away! It’s just the opposite. We must look to ourselves and focus on our own personal economy. We need to become financially responsible, so that we can accumulate enough wealth to care for loved ones, live comfortably into old age, and give generously to others.
Many financial advisors recommend having an emergency fund (no, not for the big screen TV you want) and paying down debt. Dave Ramsey suggests starting with a $1,000 emergency fund. Then begin focusing on paying off debt – the credit card or loan with the smallest balance first. Paying these off first gives you a sense of accomplishment and free’s up money to use to pay off the next debt on the list. The quicker the success, the more likely you’ll stay with the plan. After paying off a few of the bills, add to your emergency fund. Plan on having a buffer of 5-6 months of income. This fund is not an investment, it is insurance you pay to yourself!
When you have a plan, live on less than you make, and save money – you’re not in trouble. If you have no credit card debt and the card companies raise interest rates to 30%, you won't have the fears you may be experiencing now!
Given the current economic climate, it’s incredibly important to make sure you protect your largest asset – your ability to earn an income. Could you get by on half a paycheck? (www.halfapaycheck.com) One of my trusted associates, Deb Clem-Buckert, can give you some insights into recession proofing yourself. She is with HighPointe Financial Group LLC and can be reached at 913-234-0397 or dclem-buckert@finsvcs.com
Anytime you have questions, or comments on our blog, we're happy to hear from you. Email me at michele@wantinsight.com or call me at 913-642-3334. Have a blessed day.
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