I listened to the comments and the needs of my audience. Seems like this topic speaks rather loudly to everybody. In our economy, the inherent fear of job loss, mortgages resetting, rising costs of fuel, meat, milk & credit card interest having climbed to 26% and higher makes this topic a both critical and timely issue for all of us to consider. If you don’t, shame on you!
If I speak to a young person (under 35) it seems they are busy with their life and not really aware of their financial responsibilities. They seem to be in serious denial about what it is they will need as they grow older! Nobody thinks that financial devastation will ever come to them. Just others! If you are under 35 (ish) and happen to be reading this blog, listen up! Financially Stupid People Are Everywhere! Don’t be one of them!!
You will never receive Social Security.
You will never have a pension.
You will not have retirement tools available to you unless you prepare them yourself!
YOU ARE ON YOUR OWN FOR RETIREMENT PLANNING. This is damn serious.
Wake up and smell the coffee! if you have a family and a job, you probably don’t have a 401k that you and your company are contributing to? do you have a “Roth IRA” that you are contributing to? Do you put aside 20% of your income on a weekly basis? Are you high-end or basic? Will you like to travel to Europe when you retire? Do you like Chevy’s or Mercedes-Benz? Will your children go to Cornell or a State College? You dig eating out or are you and your family good about eating home every night? How much expendable income do you have? Do you have more that one stream of income? How vulnerable are you to being laid off in this economy? You getting pissed off at me yet? :) I hope so because this shit is real! The Tough Love Financial Junkie is here to open your eyes, get you in touch with life’s Financial Reality! Why? Because if you are not in touch with your personal Financial Reality, you are in serious danger of FAILING! Being homeless, broke and strung out! Think that’s a bit dramatic? Think again. It’s not!!
I have several friends that are and have lost their homes, Jobs, Cars and assets because they have not prepared well. They NEVER thought they’d lose their Jobs. When you lose your job, you lose your footing unless you are lucky enough to recover and land another job quickly. In our economy, that is not typical. In fact looking for another job can take upwards of 1 to 2 years. No kidding! That’s serious. If you have not socked away 1 to 2 years of your monthly expenses, guess what? You’re in financial distress. And the downward spiral begins.
If you’re over thirty-five, don’t feel exempt. This applies to all of us. If you’re in your 50s, and many of my readers/friends/associates are, you are even more exposed and subject to lay offs. You’ll need to be extremely aggressive if you haven’t prepared for financial security and retirement. If you’re in your 60s and have no retirement to rely on, you are going to have a hell of a difficult time surviving on what it is you do have. On one of my recent trips to Florida I noticed an enormous amount of trailer parks. Enormous! It was clear that these families are living pretty meager and that’s fine. For some people, that is just dandy and I know that. The real issue is that it’s not fine for most people. It wouldn’t be fine for me.
Wow, I’m just overwhelmed with all of the people I know who are drowning as I write this. Honestly, I’m not sure how to feel when I speak with them. I feel bad on one count and on another count I know I warned them. Somehow, nobody sees this as a reality. It seems that when it comes to finances, people run. It’s a less than comfortable process to sit down and work out your money life. It’s tied into feeling of inadequacy for men and can be a sobering awareness to see that you don’t have enough for both your family and all of the things you want and need. Do any of us really have enough? I don’t!
My friends were all in long-term employment scenarios. They all were high dollar earners (over 100k) and they all were in denial about losing their jobs. Guess what? They lost their jobs! They lost their house. Moved in with their families, sold everything they had, learned to live differently and live largely in depression, fear, worry and live with feelings of personal failure and inadequacy. These are real people who have consulted with me in the recent year or so about financial planning, financial security, financial safety and multiple streams of income being critical in today’s economy.
Here’s a financial safety check list for you along with a few Ideas to make the process more palatable and emotionally less trying.
Sit down with your spouse.
Look at the amount of debt you have together. (write it down on a separate document)
Do you have a savings plan in place?
Do you have investments?
Do you and your spouse create a budget?
Do you do weekly check-ins together to keep current on what emergencies have come up (like the dog’s visit to the vet) and how that will affect your savings contribution that week?
are you educated about finance? Compounding interest, how money grows?
This is a good start. Getting on the same page as your spouse is critical, builds strong relationship skills and lessens the shock and pain of financial failure!
To be continued! Hey, write a comment and let me know how this may be working for you!
Remember!!! The Financial Junkie Says:
Don’t spend money you will have. Spend only the money you do have!