I’ve seen a lot of people bidding a fond farewell to 2009, glad to see it go. I’m tempted to join them, since 2009 did bring a lot of challenges our way, but when I look back I realize that it wasn’t all that bad. Yes, my husband did spend 6 months among the many who were unemployed, but we managed to pull through and end up in a better spot than where we were when 2009 began. That’s due, in large part, to some things I did to make sure we were prepared.
I hope you never have to go through what we did, but even if you don’t, these tips will help you feel much more secure.
#1 – You Must Have Cash. Every financial advisor will tell you that you need 3-6 months living expenses in the bank, but I think most people see this as an unattainable goal. We assume that it’s hard to save that much. Well, when I read the tea leaves and saw unemployment in our future, I got real motivated and was amazed how much I could save, and how quickly. Yes, I stopped putting money into my retirement for a year, but I always knew that I’d be able to feed my family and pay the mortgage. Saving for your later years is important, but you need to be able to eat now.
#2 – Live Within Your Means. It’s a total no-brainer, but we almost got in trouble here. I like to complain about how small my house is, and we were close to buying a bigger one with a mortgage that would have stretched our comfort level. Well, I found that a small house feels like a palace when other people are losing theirs. Our mortgage is less than what many people pay in rent in our city, and that allowed us to stay in our home and also be able to continue to enjoy, more or less, our regular standard of living.
#3 – Know What’s in Your Medical Records. Even if you’re fortunate to have a job, the days are dwindling when people can expect their employers to provide health benefits. Let me tell you that buying insurance on the private market is an eye opener. We are probably in the 95th percentile of healthy families; the worst things we deal with are occasional ear infections and blood pressure medication for my husband. But the kinds of things the insurance companies want to know about your medical history – wow!! It’s a wonder ANYBODY gets insured. I went back through our medical records and was surprised at some of what I found – such as a mention in my daughter’s file of a minor issue I dealt with in my 20s that has been resolved for more than a decade. I was grateful we aren’t the kind of family who goes to the doctor every other week and has a laundry list of ailments. I don’t know what the answer is, until and unless health care reform passes. All I can say is that it doesn’t hurt to do a regular audit of your family’s health records and be aware of what’s really there.
#4 – Pay Off Debt When You Can. I’m a huge fan of Dave Ramsey, the financial guru who encourages folks to be totally debt free. Now that we’re back to two incomes, we’re taking some of the cash I hoarded and paying off cars and credit cards. It feels great!! And as for buying that bigger house? Well, for now the plan is to hold off until I know the economy is more secure, and until we can sink a huge chunk of cash into it. As Dave says, “Cash is King” and I know now, from experience, that he is right!!
May you all have a happy and secure – if not prosperous – new year!