What Now?

"What that is I don't know but there is a next big thing coming and it might be related to energy or the global warming problem. I just sense that there is something and I don't know if it is good or bad, but I think it is big." --> a quote from my August 12th entry. I guess I know now what I was sensing.

I spend a lot of my time these days trying to not panic about the state of the economy and the country. Well panic is too strong a word but be comsumed with worry might be a better description. I think that I will take advice from the 12 step programs and realize that the only thing I can do is control MY actions, MY reactions, and MY thoughts. So I continue to do what I do, without getting too involved in things that have not yet hit me directly in an immediate way. Yes, the stock market has bitten into my retirement fund, yes, we don't know what is ahead of us, and yes, there is bound to be some major problems ahead....BUT I cannot do anything about those right now by any action I might take. So I need to focus on TODAY and what I can do right now to keep my job, keep my house, put food on the table, and pay my bills.

I am not unaware of the world around me, but I continue as NORMAL as much as possible. I cannot imagine making a big purchase and spending is definitely something I consider carefully, as it might be money I need in the future. So the economists need to come up with a different model other than encouraging us to spend-spend-spend. That is what got us in this mess. I have decided I don't like being a country of consumers as much as I like being a country of producers.


I think it is pretty telling to watch government bailout solutions come and go -- daily -- it is pretty clear that the established theories are difficult to apply. Everyday on the news brings us a new direction -- which sends a message that nobody knows what the hell to do! Now that is confidence building --not!


One thing I have not changed and it is really creating a squeeze -- my year-end charitable giving. This might be the last year I can afford to support those causes that I embrace. That is where the country will begin to see the effect of the economic downturn first. As families hunkerdown, save their money because of the uncertainties ahead, charitable giving is going to take a major hit. The human services organizations will see it last, the arts and social non-profits will be on the front line. Governments looking for budget cuts will target cutting anything that does not have a strong vocal constituency.

Every indication is that this recession will be deep and recovery extended over a long period. No bell curve here, more like an "L" shape with a very gradual slope. The uncertainies of whether there will be deflation may become a self-fulfilling prophesy and create a spiral that would change our lives for a decade or more. Everyone is watching fingers crossed, not knowing what to do, hoping that government actions do not make it worse, hoping that someone -- a voice of reason -- will point the way out of this financial miasma.

So you can clearly tell that I am just as clueless as everyone else, the pundits included. But I think that I can give some practical, common sense advice. If money is tight and you are fearful of the future -- be calm, do not react in haste.

First -- keep the job you have. This is not the time to find a new job (unless you know your job is at risk) or change jobs. If you don't work or are a stay at home mom, consider a part time job in off times, so your partner can cover childcare. If you don't make enough money consider a second part time job to supplement your pay. There was one time in my life where I worked one full-time job and two part-time jobs at one time..
Second -- do not incur any new debt. If you are financially well off that is one thing, but if you are a regular middle-class worker-bee, this is not the time to put that HCTV on your credit card, which probably already has way too much on it already. Save up real money for that big purchase or spend the bucks for a digital converter box and wait. Because is is Christmastime, this is a really hard thing to do --- but remember that the small gifts mean just as much to the receiver as the big ones and if they don't then something is wrong with that relationship.
Kids need some honesty about your finances (look up how to teach your kids about money at http://www.kidsfinance.com/ ) and they can understand a lot -- you don't and shouldn't scare them with threats of losing a job or house, but they can understand that when money is scarce, everyone has to do their part.
Third -- as difficult as it sounds, do not stop putting money into your retirement account. It should be the last thing you cut. Now that does not mean, let your mortgage get into arrears because of this -- be practical not stupid.
Fourth -- if you are having trouble making any of your credit card payments, as embarrassing as it is, call the credit card company and ask for assistance such as a lower interest rate or payments. Think carefully about doing this because it will go on your credit record. But my guess is that there will be a lot of damaged credit records and hopefully along with that will be some understanding of the special times we live in.
Fifth -- do not let your mortgage get behind. This is the holy grail, the bill you must pay even before the car payment but not before feeding your family. There are many resources out there right now to help, call them BEFORE you get behind.
Sixth -- do a family budget of expenses and income so that you know what your real situation is and what you have to pay. Plan ahead for that quarterly payment and save up - do not rely on the ready credit that was there -- it is going to disappear fast. Start living within your means as much as possible. Most budgets will just allow you to make ends meet for the necessary things so you need to anticipate as much as possible those surprises. Car repairs, the unexpected bill you forgot about, car insurance, etc. Make sure the whole family helps you with this so that everyone knows what the obligations are.
Seventh -- look for ways you can save money. Is cable TV necessary? Do you need full coverage car insurance on the car that is paid off? Are you taking advantage of family discounts on your cell phone accounts, do you need a cell phone? Do you need a land phone line, can your cell phone suffice? Can you rent a movie and pop some corn instead of going to the movies? How about game night to play those board games and instead of going out to eat, order pizza in.
Now is a good time to stop smoking and drinking, yea I know it is hard. Walk instead of drive.
Eighth -- and yes I know that these are things you have heard before -- save on utilities by all the things you have heard before -- no I am not going to repeat them here.
Ninth -- if you have friends and/or family close by and affording food is a problem -- share the burden by having regular extended family pot luck dinners together.
Tenth -- give thanks to what ever greater power you recognize that you are healthy and have a family to support you in this time of crisis.

I hope this helps -- in the end the only thing you can depend on is yourself.

Deliver Me

Now that the elections are over we get to see if the Democrats can deliver on their promises. Don't get me wrong, I really want them to succeed, but they have a real tough job ahead of them. In my opinion, the real test is who Obama choses as his advisors, cabinet, staff and key appointees. These are the people he will depend on to get it done and if they are not the right people the whole country will suffer.

So now I am in a holding pattern, watching carefully and hoping that the promise becomes reality. This country and its people deserve transparency and honesty. Let's see if we get it.