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Financial Stability Preparing for Hard Times

Financial Stability Preparing for Hard Times

Financial difficulties and hard times can put a lot of stress on your relationship. Decide now that you will work together to prepare and to handle any difficulties that may come your way. The following are three tips to get you started:

1. Be Prepared: Hoard a Little

You may have to do this over time, but try to get to the point where you have a two month supply of the necessities. Enough food that you could feed your family for two months without having to go to the store if need be. Don’t forget toilet paper. Every time you shop for food and necessities, take home a couple of extra things and start your own personal stock pile. The strain on your family will be far less when you are prepared.

2. Start Saving

Putting some money away, will help you to be prepared if the worst should happen and you find yourself unemployed for a period of time. If you haven’t already, start putting at least 10% of your income away for a rainy day. Chances are the rainy day could come sooner than you think. Build up your savings until you have at least enough to pay your bills and survive for several months. Having some cash on hand hidden in a safe place is also a good idea, especially in the event of bank failures. Again if you are prepared for the worst then you will be less stressed. This is not something to get frantic or fanatical about, just start saving what you can.

3. Spend Less Than You Earn

If you spend less than you earn you will have financial stability and the peace of mind that comes with financial stability.

If your income is reduced for some reason, reduce your spending accordingly. Downsize to a home that you can afford the payments on immediately. This may be less convenient, but the peace of mind will be worth it. And when your income increases it will be far easier to upgrade when your credit rating is still intact.

Consider the things that you regularly spend money on and be creative in finding ways to reduce the cost of each. There may be some that you can eliminate altogether and others that you can buy less of or find a less expensive way to do the same thing.

Avoid debt wherever possible. Credit card debt is particularly deadly. Avoid putting anything on a credit card that you do not have the money to pay. The outrageous interest rates add up quickly and you can end up drowning in an unpayable debt. If you already have credit card debt, pay it down as quickly as you can. If possible get a line of credit or some other lower interest loan to pay off your credit card, then destroy them if you cannot control them. Pay off all debts as quickly as you can. When hard times hit, it will be far easier if you are not carrying a heavy debt load.