Worldwide Success

The US economy was just recently in the brink of a recession, but there were hopes that we would be able to avoid the recession or at least make it mild and short.  Now we are definitely in a recession, and from the looks of it this will likely be a deep and long one.

It is of upmost importance that the House passes the financial rescue plan in order to avoid a total financial catastrophe.   If the bill does not pass, as Warren Buffett has put it, “heaven help us.”  But even if it does pass, there has been enough damage already and the chances of the bill getting the entire economy back on track are small.  Car sales have dropped 30% this year.  Unemployment is the highest it has been in several years.  Consumer confidence is low.  The sickness from the financial industry has already infected other sectors of the economy.

But despite of all the bad news, successful people focus on what they can control.  There is nothing we can do about the economy, but there are things that you can do to recession proof you finances.  Here are a few things you should consider:

Manage Your Budget

Nobody likes to live under a budget.  But if there was ever a time to build some discipline into your spending, this is it.  It is time to keep track of where your money is being spent and live within your means.

Delay Major Purchases

I know this is not what the economy needs right now, but you need to look out for your own financial well being.  If you were planning on making a major purchase, unless you feel financially secure, you may want to consider waiting.  This is not the time to take an exotic vacation or buy an expensive luxury car.  Wait until we start to see signs that things are starting to turn around.

Reduce High-Interest Debt

Try to reduce your credit card debt as much as possible starting with your higher interest rate cards first.  Look for alternative low percentage APR cards and transfer your balance to avoid paying high interest rates.

Improve Your Job Performance

If there is any chance at all that you may end up losing your job, now is the time to show your company how valuable you are.  Volunteer to do things others do not want to do.  Show up earlier.  Leave later.  Get your projects done on time and under budget.  When the going gets tough, the outperformers keep their jobs.  If you are a small business owner, go the extra mile for your customers.

Review Your Investment Portfolio

With the awful stock market performance we are experiencing, you may want to pay closer attention to your investment portfolio.  Are you diversified across different asset classes and investment styles?  Does your asset allocation match your risk tolerance and time horizon?  Do you need a professional financial advisor to help you sort out how to properly manage your money?

Manage Your Health

The last thing you want on top of all the financial turbulence we are going through is to have health issues to deal with.  Therefore, take good care of yourself.  Eat right.  Exercise.  Get enough sleep.  Do not get so concerned with what is happening to the economy to the point of getting sick.  This too shall pass.  We will recover.  We have in the past and we will again.

Success requires perseverance.  Adverse times like these come to test our resolve.  Stay true to your plans, and persevere though this crisis.   In the long-run you will be glad you did.  You will look back and remember this as simply a bump on the road to your ultimate financial success.

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For those of you that were looking forward to the answers to the Millionaire Quiz, stay tuned.  We will publish the answers in the next post on October 8th.

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