Tips on Surviving the RecessionPosted: Updated:
With the new year and the new economy, people are re-evaluating their financial goals and how to reach them.
Just about everyone is feeling the impact of the recession, and getting ahead financially is tougher than it has been in decades.
Sandi and Jay Hofer of Vancouver, Washington, have three children, no savings, and very little in a retirement account.
Their credit card debt was more than twenty thousand dollars.
Facing the worst economy in recent memory, the hofer's are trying to get a plan.
They took a 13-week course sponsored by their church and put together a budget. It's a start.
Financial planners say this is a time to face economic realities and prepare.
"One of the key things you need to do to improve you financial picture is to make sure you have an emergency fund in place." Says Christine Benz - Morning star Financial.
With the current job market and weak economy, that means cutting back and saving a recommended year's worth of living expenses.
"Take a look at all the items that you're spending on that would fall under the category of discretionary, so maybe that's coffee, maybe that's clothes, "
"Look closely at that category and eyeball those items that you can cut out." She says.
With investments, take a look at the balance between stocks and bonds and short-term securities like cash.
And advisors say, focus on what you can control.
"I cut all the kids hair at home. We buy less clothes and cheaper clothes. We get a little less at the grocery store of convenience goods." Says Sandi Hofer.
Having a plan is paying off for the hofers.
"It's been huge. We've paid off our debt; we actually paid it off in December." Says Jay Hofer
For millions of Americans, the struggle to get ahead or even, make ends meet, requires a new way of thinking in this new economy.