How to Survive a Global Meltdown – Your Money in a Crazy Financial World

Is the pound/dollar/euro in your pocket weighing you down with worry about how low the currency can go before it’s not worth the paper it’s printed on? As currency markets around the world tumble quicker than pins in a bowling alley many people are clinging to the hope that their homes and jobs don’t topple into oblivion just as quickly.

Stores closing, factories downsizing and small business owners simply giving up are the end result of years of greedy banks and financial institutions lending money like it was a never ending pool of cash to individuals and institutions who obviously had no hope of ever paying it back.

Surviving in a worldwide financial meltdown is a difficult task if you still insist on having those ‘must have’ consumer goods. It’s a wise person who can resist the temptation of rushing to the nearest store to buy that latest HD television at a (bargain?) price. What price is a bargain though? Sure – you may have just bought a £700 television for £400, but if your current television is still in good working order and that needlessly spent £400 puts you behind in your mortgage payments then the television doesn’t seem to be such a bargain any more.

These are tough times and are sure to get tougher before there is any glimmer of light at the end of the proverbial tunnel so the watchword, in the next few months at least, should be “frugality” as after all, a penny saved is a penny earned. Tighten your belt, ride out the storm, spend any money you have wisely, on items that you actually need and don’t try to keep up with the Joneses as the Joneses will always seem to have an endless supply of cash – you don’t!

If you are unlucky enough to lose your job and become another victim of the ‘credit crunch’ then you will be glad you didn’t waste what cash you had. The rainy days you’ve been saving for are here and it’s not just raining – there are cats and dogs coming down this time.

Renewing Your Frugal Spirit

Sometimes we all have to splurge a bit. Those that truly manage their finances prepare for this moment. For example, I put a bit of money back each month in a “no guilt” fund. This money has no purpose, but I can blow it any way I like. It is my reward for managing our money wisely and living frugally.

I know that it can get tiring to be frugal all the time. You want to just go to the store and buy without thinking about anything. We all get burned out. We get tired of being responsible. It happens. Sometimes you just need a break.

So take a small break, but don’t give up and backtrack. There are things you can do to get back on the frugal track. There are ways to maintain your financial motivations. Even if you have fallen off the frugal wagon a bit, you can get right back on.

Start by looking at your goals again. Why are you living the way you do? Look at your dreams and goals. Do you need to change them or adapt them? Goals do change. Be honest and set realistic goals. Reassess why these goals are important to you. Take the time to become excited about reaching these goals. Motivation is key. Your goals are the motivation that keeps you frugal. They are the reason that you even bother to manage your money.

I know that it is easy to get caught up in the “I want right now.” It is easy to become envious of what others have. We want a new kitchen, a swimming pool and a Lexus. But step back a bit. Is cooking in your old kitchen for a few more years worth what you get in return? Prioritize your wants. If they need to become a goal, then make them goals and start saving for them. Otherwise, ask yourself if they are more important than your current goals. Is a Lexus better than retiring early and putting your children through college?

Start looking at the costs of things, not just the appearances. You can either see that nice Lexus, or you can see the really large car payment, insurance costs and worry over door dings. Figure out how much it would be worth when you finally pay it off. How much money would you lose by buying that car? How far would that money have gotten you if you put it somewhere else? Now look at everything this way. Don’t just look it, look at the costs associated with it.

Don’t be so frugal that you don’t allow yourself nice things. You can pamper yourself frugally. Spend time alone. Play with your kids at the park. Take a bubble bath. Read a good book. Drink a cup of hot tea while sitting on your porch on a cool spring morning. Whatever rejuvenates you is great. Often, the best ways to pamper yourself involve just putting down the work and relaxing for a bit. Enjoy life.

We all get tired. But you just have to reassess things and keep on going. Life won’t stop for you and your financial obligations won’t take a day off. You have to simply take a deep breath and keep working. It is worth it.

How to Rebuild Your Emergency Savings

Rebuilding your emergency savings, which were most likely depleted to cover your down payment, is the first thing any new homeowner should do after moving in. Many homeowners get caught up in renovating and making additions to their new house and end up putting themselves in a bind.

Your savings should be large enough to support you and your family for about six months. If you become unemployed or need to have a serious repair done on your car, these savings will come in very handy.

Think about investing in a money market mutual fund; they have higher interest rates than the average savings account and can make your savings larger in the long run.

Now, bringing your savings back up to where they should be will be difficult. It will take a lot of commitment and sacrifice, since you now have a mortgage to pay on top of everything else. Once you’ve saved up some extra cash, you can be a little more extravagant; but for now, take it easy.

There are a wide variety of emergencies that can come up and hit you when you least expect it. Having a healthy savings account keeps you prepared for unexpected situations. Be frugal and live on what is needed; this is the best way to build your savings fast.

There will most likely be quite a few things you can fix up or add to your new home, but you should do your best to ignore this right now. Wait until you build up your savings again and have some extra money to dedicate toward renovations.

It won’t feel too good, having a new house but being unable to fix it up. Be patient; it will not last forever.

Renovations and other home improvements should be postponed until your savings are robust. This keeps you prepared for any emergencies and eliminates the risk of being stuck in an unpleasant situation without a way out.

Improve Your Financial Situation With Debt Counselling

Managing and budgeting your finances can be just straight up daunting and a nightmare. It always seems like more is going out than what’s trickling in when it comes to money. As with anything though, and though it’s hard to admit, there’s always somebody who can manage things more efficiently than you can and that’s why there are debt counsellors.

Some people are more organised and frugal with their money and can easily balance payments such as credit cards, bank loans, auto loans, medical bills and mortgages. Those are the people with excellent credit ratings usually and are able to be obtain more credit down the road. However, not everyone can manage it quite as well and that’s how we find ourselves in the midst of a financial disaster with debts adding up and we spend money that we simply don’t have. This can haunt us and our credit ratings, making it nearly impossible to gain more credit because we’re already too far in over our heads. It happens and that’s life. To help start with a fresh, clean slate takes a lot of work and sometimes when we are so overwhelmed, we find ourselves looking to others for assistance who are experts in helping us to rebuild our record and have stronger credit ratings.

Debt counselling can usually be obtained from a non-profit organisation but make sure they are what they say! Some agencies are actually out for profit only and can turn your finances upside down, putting you in the midst of an even worse financial disaster. These for-profit credit counsellors may promote themselves by offering outrageous promises and upfront fees are sometimes just out for the money rather than to help you and before you know it, you are scammed. And often, the money that you paid in to obtain their services initially just disappeared into thin air and you are nowhere near closer to financial stability. They may not even be experts at financial advice, just good at reeling people in and trapping them. Look out for bad reputations and suggestions they give you that seem a little shady.

Non-profit agencies do usually provide the advice they were intended to. They will help you to re-establish your finances through a long and organised process. Improved credit won’t happen overnight. It could take years of steady payments but you will soon be able to learn the discipline it takes to stand on your own two feet. Instead, be patient and listen to their advice when making financial decisions and payment plans. So, obviously, steer clear of anyone that promises an easy, convenient way out of your financial burden.

High quality debt counselling services not only offer one-on-one customisable advice based on your particular needs, but also may offer classes and other materials to educate yourself on better money management and eliminating current debts and will teach you how to form a budget and stick to it, keeping in mind your recurring payments with creditors and lenders. This will eventually enable you to make these decisions for yourself for the rest of your life, giving you the capability to make sound financial plans and anticipate positive outcomes. The education that they provide you will not be a simple fix but will instead, provide you with the information you need down the road to continue to proceed with confidence when dealing with your debts and budgets all on your own.