HIGHLY POTENT NEWS THAT MIGHT CHANGE YOUR VIEWS

6 Key Ways to Survive a Personal Economic Collapse

Conscious Life News

Daisy Luther | ActivistPost | Nov 26th 2013

economyWith all that is being written about the national economic collapse, people seem to be waiting for some huge event.

However, for many North Americans, the collapse is here. This isn’t relegated to only lower income neighborhoods. As an article from a Cincinnati new station stated, “Hunger doesn’t know a zip code.”

For many people who were formerly financially comfortable, the economic collapse has already happened in the form of a job loss, hours that have been cut back due to Obamacare requirements for employers, an exorbitant medical bill or other crushing debt, or simply an inflation rate that has outstripped your pay increases. Despite all of the warnings, many people are still going to be absolutely blindsided.

For many families, personal finances have reached a catastrophic level – they are left to make terrible choices:

  • Which utility can I live without?
  • Should I walk away from my mortgage?
  • Should I eat something so I can work harder or should I skip meals so my kids have food?
  • Should I use the grocery money to take my child to the doctor or should I wait and hope he/she improves without medical intervention?
  • Do I risk the IRS-enforced penalties by forgoing enrollment in Obamacare or should I skip that whole grocery shopping thing so I can pay the monthly premiums and enormous deductibles in order to stay in the government’s good graces?

These are the kind of decisions that people across the nation are grappling with every day.
I’m talking about good people, hardworking men and women who have always been employed and paid their bills. A personal financial crisis does not just strike those stereotypical “welfare queens” with the long manicured nails, Gucci knock-off purse, and a grocery cart full of EBT-funded lobster.

I’m talking about the person next door, who seems to have it all together. I’m talking about that quiet family that sits two rows in front of you at church. I’m talking about that two-income family with two children and a car in the driveway that takes them to work and school 5 days a week. I’m talking about people just like you and me.

What is a personal economic collapse?

A personal economic collapse is a little different than the major crises you see all over Europe right now, where huge segments of the population can’t feed their children or stay employed. It is a crisis that just hits your family due to a given set of circumstances. (In actuality North Americans are on the brink of the kind of collapse that is occurring in Europe, but because of easy access to credit and a buy-now, pay-later society, many of us still have the appearance of prosperity.)

Here are some signs that you may be in the midst of a personal economic collapse:

  • You can only afford to pay the minimum payment on most of your bills.
  • The same dollar amount you used to spend on groceries doesn’t buy enough food to feed your family for the week.
  • You can’t afford to go to the doctor when you’re sick.
  • You are taking dangerous steps to “stretch” needed medications because you can’t afford the prescriptions.
  • Your utility bills are past due and your power is in danger of being cut off.
  • You skip meals in order to save money or to have enough food for your kids.
  • You’ve lost your job or had your hours cut.
  • You have lost property due to foreclosure or repossession (such as your home or your vehicle).

Surviving the crisis

Times are tough but you can survive this.

1.) First you have to see exactly where you are.

It’s time for a brutally honest assessment of your finances. If you use your debit card or credit card for most expenditures, you’ll easily be able to see what you’re spending and bringing in.

Print off your bank account statements for the past 2 months. On a piece of paper, track where your money is going. List the following

  • Rent/Mortgage
  • Utilities
  • Car payments
  • Vehicle operating expenses (fuel, repairs)
  • Insurances
  • Credit card and other debt payments
  • Telephone/Cell phone
  • Cable/Satellite
  • Internet
  • Extracurricular activities for the kids
  • Extracurricular activities for the adults
  • Dining out
  • Groceries
  • School expenses
  • Clothing
  • Recreational spending
  • Gifts
  • Miscellaneous (anything that doesn’t fall into the above categories gets its own category or goes here)

Don’t say to yourself, “Well, I usually don’t spend $400 on clothing so that isn’t realistic.” If you spent it, then it’s realistic. You are averaging together two months, which should account for those less common expenses. Brutal honesty isn’t fun, but it’s vital for this exercise.

So . . . what do you see when you look at your piece of paper with your average monthly expenditures for the past two months? Are there any surprises? Did you actually realize how much you’ve been spending? Most of us will immediately see places that we can trim the budget. Those $1-$5 purchases can really add up. Reining them in may just allow you to take care of an important need that you thought you could not meet.

It can’t continue like this. The economy will not withstand it. Step one is to see where you can cut things out right now from the above expenditures. Can you reduce your grocery bill? Slash meals out? Budget more carefully for gift-giving and school clothes?

2.) Rethink necessities.

If your finances are out of control, the best possible reality check is a stark look at what necessities really are. It is not necessary to life to have an iPhone, a vehicle in both stalls of your two-car garage, or for your children to all have separate bedrooms. People in Southern and Eastern Europe right now will tell you, as they scramble for food, basic over-the-counter medications like aspirin, and shelter, that necessities are those things essential to life:

  • Water
  • Food (and the ability to cook it)
  • Medicine and medical supplies
  • Basic hygiene supplies
  • Shelter (including sanitation, lights, heat)
  • Simple tools
  • Seeds
  • Defense items

Absolutely everything above those basic necessities is a luxury.

So, by this definition, what luxuries do you have?

3.) Reduce your monthly output

Reduce your monthly payments by cutting frivolous expenses. Look at every single monthly payment that comes out of your bank account and slash relentlessly. Consider cutting the following:

  • Cable
  • Cell phones
  • Home phones
  • Gym memberships
  • Restaurant meals
  • Unnecessary driving
  • Entertainment such as trips to the movies, the skating rink, or the mall

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