SAVE MONEY

My neurotic obsession began in 2007 (and no smart comments are allowed…smile) due to noticing a cycle in economic downturns - the housing crisis of the late 80’s, the dot com bubble bust in the late 90’s, and then the financial crisis of 2007 and 2008. I decided I wanted to be proactive.

I lost my job at end of the 80’s due to the housing crisis and the effect on the construction industry. Many of my clients lost a third of their investment retirement money at the end of the 90’s. When 2007 came, people were losing their homes. I decided I had enough of good people who paid their own way and did not manipulate the system continually coming up with the “short end of the stick.” So, over the last 13 years, I read the financial news every day and shared whatever information I found.

I attended the Public Forum held by the Tax Advocate, Nina Olsen, about the Future State of Taxation. She kept referring to a “five year plan.” It has been five years. We are about to get the “short end of the stick” again. This law that has passed is massive – 2 trillion dollars. It will need to be repaid. High inflation and taxes are in our future amongst other unpleasant things – continuing to work long after retirements were planned and harsh monetary effects on the retirement plans.

Here is an extremely important piece of advice: it is imperative that we learn from these downturns in the economy. We must cut our budgets and save money. Paying off debt, as it is a real budget killer.  This is for both individuals and small businesses. I realize this will not be easy, but make a ten-year plan. Also track your cost of living costs from one year to the next, so that you can see the actual (not government-stated) cost of living increase. This assists in seeing where to cut costs and when to increase income.

Throughout my career, I have done taxes for international students from all over the world. I have learned a great deal from them. In their countries, they learned from suppressed economies to have generational wealth and to be frugal to build it. I heard a story about how families continue to live together. Parents work and pay off their house.  As they grow older, their children live with them, continuing to work and save money, and care for their parents until they pass. Their own children reside in the house as well. They work and save money. When their parents pass, they have a home that is mortgage-free and, at least, two generations of savings. The cycle continues. We can learn to save as well (maybe without the residency requirements…smile)

This is vital. There will always be a downturn. During my research, I found that we have a recession approximately every ten years. Start preparing for the next one now, because a $1,200.00 disaster relief check, grants, and loans will not always be guaranteed by the government - nor do they cover all the costs needed!

Wishing for the best for everyone,

Barbara