While it’s not mathematically possible to spend less than you earn when you’re not making any money, there are still a number of things you can do to keep yourself from sliding too far into oblivion…
It’s a tough market, but don’t think that means you need more weapons for your portfolio. Now more than ever, don’t complicate your strategy. Simplify it.
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Late last year, when there was blood in the streets, a well known discount broker (Company A) was said to be on the verge of bankruptcy and the stock tanked 50% in one day. Not only did it tank 50% but the prognosis on the street, at least perpetuated by mainstream media, was that company was hosed and that they were going under. They didn’t have a rich history of being able to fight off adversity, they were relatively new in the financial business and lots of people figured they’d collapse. SIPC insurance would have to be initiated to save accounts and it was going to be yet another one of the casualties of the sub-prime mess. Would you have sensed that the market had panicked and bought shares? Or would you have joined the bandwagon and watched the shares fall into oblivion?
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When the Fed drops its federal funds rate, economists across the world shudder as they see the spectre of inflation peer over the horizon. You ever wonder why that is? The answer is quite simple but will come in two parts. First, a brief refresher on supply and demand, followed by how that and the Fed’s lowering of rates may bring on inflation. Before we begin, I want to make note that everything has been simplified from what’s actually going on. Everything is very complicated in reality but you can explain the gist fairly easily if you’re willing to take some liberties. Those who have a background in economics and know all the intricacies will see some inaccuracies, but they are there to make the explanation smoother. A basic understanding is far better than none at all.
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With rising energy prices, fear of a recession, and the stock market erasing the gains of the last six months, you’re probably looking to save wherever you can right? Well, today I have the opportunity to share ten fantastic tips you can use, many with hardly any up front investment whatsoever, right this very second to save yourself some money.
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A sell off in Hong Kong will not hurt you. And Hugo Chavez will probably not have any impact on your wallet either. Stop worrying about things that will have no effect on you at all. This also includes unsubscribing from the media sources that provide this information. Focus on what you can impact today.
Call up your provider and tell them you want to review the entire plan. Go over what services that you currently have and what you need. Then ask what the best way that they can solve them with any discounts that might be available.
You will need a certain amount of that you have easy access too. But not too easy that you’ll spend it. Having an “internet savings” account is the best option. A company like ING Direct is great for that. They offer a high interest rate on the money. Have no limits on the amount that you need to deposit and you can deposit or withdraw funds electronically into your checking account.
Going through your money life, you should expect and plan for speed bumps. What are speed bumps? It’s those unexpected expenses that come up without planning for them. Like $300 to fix a “small” car problem. Or the $400 medical bill that the insurance won’t cover. Set aside $100 into an easy access savings account and each month add .5% or 1% of your income to this account until you get to a comfortable amount.
With the downturn in real estate, it reminds me of what I learned some time ago. Everything operates in cycles. Learning to understand cycles is crucial to long term money success. Cycles in the stock market. Cycles in real estate. Cycles in earning. Know when it goes up and when it goes down.