Whether you are struggling to make ends meet or just trying to save a bit of extra cash, these tips are useful. Find ways to cut back and get help on making the tough decisions. Get your recession advice here!
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Downsizing: different strokes for different folks
If you’re single and currently renting an apartment, downsize to renting a room, getting a roommate, or even a studio. This may also work if you’re a couple with no children.
If you have young children, you may want to have the children share a room in a two-bedroom apartment or have them share a space in a one-bedroom apartment.
And, before you write and tell me that your kids need space to run and play, don’t. We’re discussing the need to stay above the recession tide and your kids having a space to run and play in the house isn’t a priority at this stage in the game. This especially applies if you have very young children. They do not need their own bedroom. This isn’t about keeping up appearances to your children or family. This is about saving money and being able to literally keep food on the table. Of course, this is often a very uncomfortable reality for many but the sooner you embrace it the sooner you will move past it and understand that this is only temporary.
What should I cut from my budget?
This will largely depend on your streams of income. How much, how often, etc…
- Eating out: You should under no circumstances be eating out if you’ve lost your job and have no income. Eating is a necessity. Eating out is a luxury. When preparing meals at home, try Aldi as a great alternative to high-priced supermarket brands. Food budget basics include:
- Lemons/limes (for flavored water or lemonade)
- Canned food: soups, beans, peas, veggies
- Pasta: ramen noodles, regular pasta
- Ground turkey (very versatile)
- No red meat, too expensive
- Hair salon: Do I really need to explain this? Get a hair dryer and your favorite shampoo/conditioner and make it work! YouTube gurus offer up a lot of advice around how to style your hair sans salon visit.
- Cell phone: This is tricky. My advice here is if you have a laptop and regular access to WiFi (local library, Panera Bread, McDonald’s) then you don’t need a cell phone. With the advent of Google Voice and Skype, you can easily make phone calls to prospective employers using one of those services. If you have to have a cell phone then Safe Link may be an option as this is available to those who are already on food stamps or Medicaid.
- Car: Give this up if you live in a fairly “metro-friendly” area. If you have access to buses and subways then this is a no-brainer. Expenses like gas, insurance, repairs, and/or a car loan are things you don’t absolutely need right now. If you can, sell it and relieve yourself of the monthly expense. Opt for a bike share or using a service like ZipCar when necessary.
- Health care: If you need to go to the doctor and can’t afford health insurance, a federally funded health center is a great option. This is often missed when discussing alternatives to health insurance. These clinics allow you to pay what you can afford, based on your income. Health centers provide:
- Checkups when you’re well
- Treatment when you’re sick
- Complete care when you’re pregnant
- Immunizations and checkups for your children
- Dental care and prescription drugs for your family
- Mental health and substance abuse care if you need it
Should I pay creditors?
If you can afford to do so, yes, pay the minimums to save your credit. Call your creditors and explain your situation and they may be able to work out a plan with you. If you can get on a program that makes your payments if you lose your job, do it. But ask your creditor if this is available before you tell them you can’t pay. Get on that plan, usually a little more than $1 per month, which they add to your balance.
Of course, if you have to choose between eating/shelter and paying a bank, the choice is obvious. The bank will be fine until you get back on your feet.
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— Wealth Building Daily