Strategies for Surviving a Recession

[redsoxmaniac]

Well if it isn't here...it sure feel like it is and it looks like it is coming. What 3 things will you change in your life to try and bulletproof your life in this economy?

[kav122]

We had a $1000 emergency fund (per Dave Ramsey's plan) and we have temporarily put a hold on paying off 2nd mortgage (I mean, we aren't paying all extra $$). Instead we are building savings. Once we get comfortable, we will go ahead with the extra principle payments.

We figure if and when the economy gets more stable we could always dump the extra savings onto the debt. So we aren't really losing anything besides a little interest.

[yourbeginnings]

I am on the same path. I have been pretty aggressively building my emergency fund. Most of my available income was going to pay off my second mortgage, however over the last year I have been depositing that money at ING due to the increased talk about recessions and unsure about the stability of my employer.

[kav122]

Hey, ING has been getting my $$ too!

We are totally N'sync!

[jdp]

I must be recession minded because I think its just all the things I've already done - try and make sure my bills would be payable even on a p/t minimum wage job, don't pay for luxuries and instead enjoy simpler things and save, a lot. Right now I am wrestling with actually *using* all that money I've saved in a house downpayment fund for a house downpayment and not just sitting on it because its everything I have.

[kav122]

jdp-just my two cents. I would love to be in the position of having a downpayment in this market. However, don't let me, family, a real estate agent or anyone tell you "you have to buy now! It's the perfect time! You won't ever get a chance like this ever again!" Because I think it will be a great time to buy for quite a while. I say sit on it until you are ready...or until it hatches kidding.

[rachael24]

It is a good time...but if you arent ready, there is no reason to try.

[redsoxmaniac]

I have the emergency fund socked away but since the kids'(2) college fund...well you know that stock market thing...sigh. We will suck it up for another 4 more years in the face of this economy.

I am mostly trying to reinvent my habits. My new focus:

1. Eliminate as much waste as possible. Recycle, reuse, repair. Eat what is there. Make it yummy so they fight over the last bit of whatever it is in the fridge. Seal-it freeze it. Be mindful of every dollar that comes in and every dollar out. Make do.
Take on projects that you are capable of...utilize on-line resources for info. Make friends with the guy at the hardware store who seems to know how to do/fix everything...if not him a neighbor who seems to be able to do the same. Pick their brains.

2. Stretch everything I can: meals, using less costly protein or reduce by 1/3, try and save a buck whenever I can on eliminating 'extras', extend the time between everything from haircuts to purchases. Buy and cook in bulk when its sensible. Eat from the pantry and freezer. Use the library. Swap books, videos etc. Cancel monthly subscriptions. Fall in love with the dollar store. Will grow more food among the flowers this year...mostly salad stuff but also some squash.

3. Fuel. Walk when I can saves gas, burns calories. Combine errands with commuting. Buy local for a few extra cents it makes the joke of shopping around ridiculous if you add the gas. Have friends over to eat rather than eat out with them. Take public transportation when I can. Unplug appliances, I am not using. Shutting them off isn't always enough, some still draw current. I've become a psycho when it comes to turning the heat down (I am in Maine). Wool socks and long johns are way cheaper than propane. I supplement w/electric blanket when needed and a small space heater. Substantial improvement over last year.

None of these seem monumental but when I look at what I have spent in the past by ignoring most of this, it seems like these will help to stop the bleeding.

[jdp]

Originally Posted by kav122

jdp-just my two cents. I would love to be in the position of having a downpayment in this market. However, don't let me, family, a real estate agent or anyone tell you "you have to buy now! It's the perfect time! You won't ever get a chance like this ever again!" Because I think it will be a great time to buy for quite a while. I say sit on it until you are ready...or until it hatches kidding.

Thanks kav. I've been working on this for two years. I guess thats when my recession mindedness kicked in. It helps that I live in an area where houses are pretty cheap and I and family have some skills in fixing things up. And with rents being more than mortgage+taxes+insurance it just seems to make sense. That and I'd have more control over the other budget eating things like utilities. No one else is pushing me but me. The problem now is most places won't do a mortgage under a certain amount so I've been working up to 20% down figuring in that to hit the minimum they want for a loan amount. Which puts me just in the range of the group that buys properties to flip or convert to multiple rental units. GRRRR

[Lynnae]

I'm just doing the best that I can right now. Unfortunately, our savings is going to be wiped out when we pay our taxes (long story, don't ask). I'm going to rebuild the savings account as quickly as I can, cut expenses as much as I can, and continue to pay down our debt. Fortunately my husband's job is more stable than it's been in a long time, so we're OK for now from an income standpoint.