 |
How To Protect Yourself In An Economic Crisis
Author: Sandra Simmons  | Posted: 20-11-2007 | Comments: 0 | Views: 20 | Rating: (65)  (?) 
 Does the current economic crisis have you worried? Are you wondering how to achieve financial freedom so you can protect yourself and your family from the coming financial crash? Here is what you need to know.
The first thing you need to understand is what the word economics means in terms of thinking about your family, and how you can use what it means to your financial advantage.
Forget what the media says about economics when they talk about the roller coaster ride of the stock market, supply and demand, inflation, banking industry mortgage defaults and the unemployment rate. Those are 'economic characteristics' that measure an area much larger than you can control.
What you can control is your own household economics. The definition of economics I am using is the original one; meaning "the art or science of managing a household or business." And that is something that you, as an individual, can control.
There is an art to managing a household. It takes having certain skills and abilities, like organizing things so they run smoothly. There is a science of managing a household, especially in the area involving money. Here is what you can do to make sure that the economics of your household are strong and stable, even though the economy of the country may be on the slippery slide to disaster.
1 - Spend Less Than You Make
Take a lesson from your parents or grandparents who made very little, but lived very well. Keep expenses down to a level below what you bring home in your paycheck after taxes. The fastest road to financial disaster is spending more than you make. It's possible to maintain your quality of life while cutting optional spending. This can be done by doing something as simple as renting a movie and making popcorn at home instead of going to the theatre, to buying a new used car instead of a brand new car.
2 - Pay CASH
Every time you purchase something using credit cards that you cannot pay off as soon as the statement arrives, you are committing your future earnings to the credit company. Those future earnings will be needed to pay your regular household expenses, so you end up in economic slavery known as the credit trap. The exception is purchasing property that increases in value, such as buying a home or investing in a commercial building that puts more income in your pocket.
Tip: When paying with cash; negotiate a cash discount. When the economy is sliding down and credit is harder to get, the guy with the cash is king. In addition, find out how to buy wholesale instead of retail to further lower your cost.
3 - Make the Money BEFORE Spending It
If there is some large purchase you need to make or want to make in the future, start putting small amounts in a savings account towards that purchase and keep that up until you have the cash to pay for it. If you have 10 years before your child enters college, then find out what the tuition will be and figure out how much you have to put away every week to have the cash the year they graduate from high school. Plus apply for every student scholarship, grant or financial aid package you can locate.
4 - Stash Some Cash for Emergencies and Living Expenses
Nothing will make you sleep better at night than the financial freedom of having some cash tucked away for emergencies like having to get the car repaired, needing some unexpected dental work or losing a job. When you have a cash cushion you can get your hands on immediately, then magically, you stop worrying about money, your attention goes back on living life and enjoying it, and making money suddenly gets easier.
The only thing you have to fear in an economic crisis is not having some cash reserves in a savings plan you can immediately get your hands on. Did you know that more millionaires were made during the Great Depression in the United States than during any other era in our history? How did that happen? In that time, the economy crashed, the stock market crashed, inflation took prices of everything through the roof, the unemployment rate went sky high as businesses closed, and people who lost their jobs also lost their homes.
The people who had cash stashed away were able to buy houses, property and whole companies for pennies on the dollar. They ended up being millionaires because they had enough cash to weather the storm called the Depression.
Out of every bit of income that comes in the door, immediately carve off 10% and put it in a savings account that you have designated for your cash cushion. Even if you have to work an extra job and cut expenses on top of that, JUST DO IT! As the weeks roll by you'll find you sleep better at night and walk through life with a lot more confidence knowing you have achieved financial freedom and have protected yourself from the economic crisis looming on the horizon.
Rate this Article:
Current: 0 / 5 stars - 0 vote(s).
Article Source: http://www.articlesbase.com/finance-articles/how-to-protect-yourself-in-an-economic-crisis-263268.html
About the Author:Sandra Simmons, President of Money Management Solutions has years of experience helping business owners and individuals manage their money to achieve financial freedom. Watch the FREE 5-minute demo video on her website www.MoneyMgmtSolutions.com
|
Submitting articles has become one of the most popular means of generating quality backlinks and targeted traffic to your website. Join us today - It's Free! |
|
Got a Question? Ask.
Ask the community a question about this article:
Frequently Asked Questions
Can you tell me any thing about paul elby hall
By: iamthenewjudge23 | 11-07-2008
can you tell me any thing about paul elby hall
Confused
By: Rlynn | 11-07-2008
I've been with my boyfriend for 2 years now and like all relationships we have had our problems, i just recently found out he's going to be leaving me for 6 months to go on tour, he said he wants to continue the relationship while hes away im just scared he may find he doesnt have room in his life for me. What should i do let him go or stick it out?
What is the right time to start with stock investing?
By: Tadday | 11-07-2008
Stock Investing - what is the right time to start with stock investing?
Venture captial agreement
By: steve | 10-07-2008
looking for a contract format for drafting agreement with an investor to fiance growth
Debt settlement
By: Dorothy | 10-07-2008
should i negotiate with credit card co. or use a debt settlement co.
Looking for a hotel/motel help
By: jen walker | 10-07-2008
HelloI dont know if any one out there can help me or not, but i would like to know, i am trying to buy a hotel/motel start property but my credit score is 500 and no bank is willing to loan me the money to but a property, the size of the preproty that i am looking for is from 30 to 60 room with NO resturant. where i would like to have it is in AK,WA,ID.MT,ND,PA BUT If SOME ONE WOULD LIke me to be some where els thats fine. At this time i am a manager for a wearhouse with a B.S in hospitality and i would be glad if i can get my first starter property. yes i will do what i have to, get down to give you your money back. Please if you can help me let me know.
Q&A Powered by: 
Latest Finance Articles
3 Great Benefits of FX Trading
By: John J Callingham | 20/07/2008
FX trading or foreign exchange trading has become increasingly popular amongst investors today. With an estimated market trade valued in excess of $3.2 trillion the trade in currencies is perhaps, one of the largest as compared to other financial products such as stocks and futures. This increased popularization of foreign...
3 Powerful Benefits of Online Trading For You
By: John J Callingham | 20/07/2008
The popularization of the internet has allowed many people today to use online trading for a variety of financial products. Such financial products include foreign exchange, stocks, options, futures and commodities. The numerous benefits of online trading are a key reason why so many people today choose to participate in...
3 Sure-Fire Ways to Enhance Your Forex Trading Education
By: John J Callingham | 20/07/2008
Forex trading education is in all sense of the word, vital to those who are keen on entering the foreign exchange market. Contrary to what most people think, success in foreign exchange trading is extremely dependent upon one's level of financial literacy, which in turn determines one's ability to make...
The Importance of Trading on a Forex Demo Account
By: John J Callingham | 20/07/2008
A Forex demo account is essentially a practice account allowing investors to use "paper credits" in place of real money when making their trades on the foreign exchange market. In recent years, demo accounts have gained immense popularity following the increased interest towards Forex trading as a form of financial...
Get an Extra Income From Currency Online Trading
By: John J Callingham | 20/07/2008
Currency online trading is fast becoming the investment instrument of choice for many following the diffusion of the internet as a mode of telecommunication to many parts of the world. Indeed, valued at a daily trade turnover in excess of $3.2 trillion, the foreign exchange market where currency trading is...
What Is Currency Trading - Learning The Ropes
By: John J Callingham | 20/07/2008
What is currency trading? This is perhaps one of the most common heard questions, in the light of the recent increase in popularity of foreign exchange trade as a mode of investment. Fuelled by the growth of the internet as a means of telecommunication, the foreign exchange market is the...
The Irresistible Benefits of FX Online Trading
By: John J Callingham | 20/07/2008
In recent times, FX online trading or the trade in foreign exchange over the internet has become immensely popular amongst the general public as a whole. With the availability of cheap, reliable, high speed internet connections, more people are turning to Forex online trading as both a means of investment,...
3 Excellent Benefits of Foreign Currency Exchange Trading
By: John J Callingham | 20/07/2008
Trade volume in foreign currency exchange trading has increased dramatically in recent years. Following the widespread adoption of the internet as a communication device, turnover in trade has exceeded more than $3.2 trillion each day. Yet, to attribute this dramatic increase in trade volume solely to the internet would simply...
More from Sandra Simmons
Get Debt Relief - Use Dateline Paying
By: Sandra Simmons | 23/05/2008 | Finance
Okay, so you are in debt and your creditors are screaming. How do you handle it and get debt relief without having a nervous breakdown? Use a simple tool called Dateline Paying.
Dateline paying is a simple method of paying oldest bills first, based on the due date. The dateline tells...
Get Debt Relief – Use Dateline Paying
By: Sandra Simmons | 13/05/2008 | Debt Consolidation
Okay, so you are in debt and your creditors are screaming. How do you handle it and get debt relief without having a nervous breakdown? Use a simple tool called Dateline Paying.
Top 7 Actions to Guarantee You Will be Broke
By: Sandra Simmons | 10/04/2008 | Personal Finance
So you want to be broke and stay in the economic trap? Here are the top 7 actions you can take to insure you have NO MONEY and are living in poverty.
What to Do With Your Stimulus Tax Rebate
By: Sandra Simmons | 10/04/2008 | Wealth Building
More than likely you are already getting excited about the big check you are probably going to get from the government. You may even be mentally shopping for some gizmo or gadget you have had you eye on. That can be a fatal mistake.
Are You a Gratification Groupie or a Genius?
By: Sandra Simmons | 10/04/2008 | Wealth Building
There is only one thing that separates you from the people who have the money you wish you had. It is not talent, skill, the things you own or the connections you have. It is the MINDSET.
The Secret To Making More Money
By: Sandra Simmons | 21/12/2007 | Business
Do you feel like every dime you make gets sucked into a black hole to pay bills and leaves you asking yourself, "Where did all the money go?" Want to know an age old secret?
You have to make the money before you can spend it!
How do you do that? It's...
Understanding The Credit Card Trap
By: Sandra Simmons | 08/12/2007 | Finance
Credit cards are an alluring trap invented by our modern financial system.
Buying something using a credit card is not bad, IF you have the income to pay the credit card balance in full when the statement arrives, plus all your other bills.
But buying with a credit card because you don't...
The Ultimate Wealth Building System
By: Sandra Simmons | 26/11/2007 | Finance
Most people search for the ultimate wealth building system for most of their lives. It may surprise you to know that you own half of it the day you are born.
What half do you own? It's your ability to make money. No matter what your education level or skill level,...
|
|
Finance 
