We need to be realistic with our planning – do not over-expect from our jobs, our relationships or the money we earn. Prioritize; decide on the order of your life, education, spouse, investments, car, house, children, travel and retirement. Why not think of life as four seasons – Spring, Summer, Autumn and Winter? I do not think there is any right or wrong way to order our lives, as in the end it will all work out. What is important is how we live and if we are happy living the lives we decide on. Another thing is not to envy other people’s lives or copy the choices that they make.

Therefore, a good place to start is to write a budget, record all that you earn and all that you spend. If there is a spouse or a significant other sharing facilities at home, this person must be included in these planning and budgeting arrangements. Even the older children should be a part of the discussions, in order to be aware and become willing to assist in saving on some of the basic things they use. It will be amazing to see, when we record this information on paper, all of the opportunities to effect change.

Let us explore on e of the largest investment and expenditure items we will incur – the acquiring of a house, which may involve a mortgage. Whether times are good or bad, we should seek to reduce and accelerate our mortgage payments in an effort to:
1. Reduce the monthly payments.
2. Reduce the balance outstanding.
3. Accumulate approximately three months worth of re-payments in an interest-bearing investment, similar to an emergency fund.

These should take priority over lavish spending when times are good. If we value the ownership of a house, then this is a sure way of securing your home as your safe haven. This means that spending less and saving more will become a positive way of being resilient when the bad times come around. Let me play devil’s advocate here – Is owning a house a real priority? Can you really afford it? Is this a part of our culture? In order to achieve our set goals, we need to deny ourselves some things. Let us think about it – vacation, the choice schools, designer clothes, expensive cars and several credit cards. Why not have one credit card just for emergencies, being sure to look for one that gives bonuses, like travel miles, a low interest rate, etc. Vacations may have to take a back-burner for a year or two; expensive cars that are equally as expensive to maintain may have to be sold; and a more affordable vehicle purchased.

Just as how a factory re-tools by acquiring new and more effective equipment in order to produce more, we also need to re-tool ourselves. This may involve pursuing higher levels of education or diversifying our educational qualifications, seeking new employment, changing your primary job function n your existing vocation or starting your own small business on the side. Sometimes one should look outside the comfort zone. A hobby can be converted into an earner.

During a recession, life goes on. A country cannot close up, pull down the shutters and go out of business, as there will always be new areas and ideas revealing themselves to us. Volunteering is a great way to improve the human quality of life for ourselves, as well as for others. We can work through churches and schools in our communities in a particular area of interest; this is considered an altruistic activity, and a very powerful way to create change a feeling of well-being, satisfaction and accomplishment in oneself. Volunteering can also inspire you and direct you to areas that you might not necessarily have thought about and may ultimately create employment.

Finally, seek the help of a licensed financial advisor to design products to satisfy short, medium and long-term investments – do not be afraid to look to other countries for investment options (the Caribbean is a good place to start), and remember your responsibilities, by staying diligent and consistent. The recession cannot last forever – it will one day be over and we must be prepared for new opportunities as they arise.

Or is it a situation where you overspent during the Christmas holidays and therefore, you’re in a financial rut, unable to find an open door? Well, don’t panic. There are ways to rid yourself of debt and start your financial plan for this year and the next decade. It is not too late. You must however be committed, persevering and relentless, as the accomplishment of your financial goals requires great sacrifice, especially in these harsh economic times.

Step 1: List Your Expenses: DO NOT BE AFRAID! This process requires you to be completely honest with yourself. Find somewhere quiet to sit and gather your thoughts.

• Go through the essentials: Food, shelter (mortgage / rent), electricity, water, clothes, basic school fees for children, transportation (and related costs such as car insurance, gas, toll, bus fare, taxis, etc.), loan payments (including credit cards) and your savings.
• Go through the “nice to haves” by evaluating your living costs: Consider taking in a boarder, can you save more money switching from a full-time helper to a part-time one? Lunch money, personal insurance, cable, entertainment, extra clothes, help in the home (helper/gardener), brand name consumer items and expensive vacations. Ask yourself these questions. Do I have to purchase lunch everyday, or can’t I just pack lunch and take to work? Do I have to take my clothes to the dry cleaner every two days, or can’t I just do it weekly or every two weeks? Asking these questions can help in reducing your expenses and manage your costs.

Step 2: DO NOT PANIC if your income is less than your expenses. Panicking does not solve problems. Focus your energies on finding a solution. You will be surprised at how many possibilities that may exist in the marketplace that is simple and cost-effective.

Step 3: Even if your income is less than your expenses – start to think creatively. For many of us, our food bill (supermarket / market / lunch money / entertainment) is our greatest bill. Can anything be cut?

• Do you buy food every Friday night? Can it be cut down to a once per month treat?
• Do you spend money for lunch everyday? Can you take lunch to work on some days?
• Does your family eat meat for dinner everyday? Can you consider callaloo / cabbage / pak choy once or more per week? You may also use these vegetables to “stretch” meat.
• Do you go to the hairdresser/manicurist every week? What about a massage? Can you do these things less often? If so, make a plan for how it will work and stick to it.
• Do you buy only “brand name” canned meat / bleach / washing soap / bath soap? Can you buy substitutes?
• Can you buy fruit / vegetables / ground provisions from the market instead of the supermarket? If you can’t go every week, can you go once per month?

Step 4: Remember that budgeting is not an “all or nothing exercise”. Consider ways of earning more. If your vacation currently consumes most of your time, it is practical to consider additional income? Can you consider reducing costs?

Step 5: Remember that you still have control. You can still choose what you want to cut and if you want to earn more instead. You don’t necessarily have to cut out everything so don’t give into depression or doubt or worry!

Step 6: Consider ways of saving on electricity and water. Unplug those appliances that you’re not using. Do not iron each day, save one day to iron and one way to wash. Turn lights off and use your air conditioning unit only when necessary.

Step 7: Set goals, short or long term. These goals should be well-defined and concise. Spend some time thinking about what it is that you need to achieve and then write them down. Create two categories for your goals, those that are short term and those that are long term. Goals can be simple, such as saving $5000 a month towards a down payment on a house, paying off the credit card bills in a year, with a $10,000 a month minimum or putting aside money for an early retirement.

Know your weak points and how they will affect the achievement of your goals. Save at least 3 months of basic living expenses. If you’re indisciplined try to have money to be deducted from your salary or income or bank account automatically (several employees provide these opportunities for their staff, banks also provide these types of automatic alternatives for their customers).

Be realistic by starting small. As soon as you develop the habit of saving, then you can increase your increments. Just remember to be consistent. As you work towards your goals, evaluate your progress monthly to ensure that you’re on target. Remember, there are possibilities to save such as:

• Automatic transfers to bank accounts
• Transfer to investment accounts
• Choices and purchases of financial products (diversification still essential) – make sure that you invest in different asset classes. There are a variety of options that persons can choose from such as Commercial Papers, Long Term Investment Accounts, Mutual Funds and Stocks, stockbroking, funds management, pension funds management and administration and structured financing services.

The bottom line is that there is a wide array of alternatives and possibilities but you need to sit and work out a personal plan to suit your lifestyle, tastes, goals, and financial situation. The good thing about saving is that the liquidity puts you in a position to take advantage of opportunities when they are at their lowest cost/price. You may be able to buy real estate that is being offered at a bargain, you may be able to take advantage of that super sale on a cruise/vacation, you may be able to supplement that education for your child when he/she is awarded a scholarship that doesn’t cover all costs (but the opportunity is priceless). The point is that liquidity affords you choices that are not available if you are financially unprepared. Throughout good times and bad times, everyone ought to save. Work out the math; are you now in a situation to save? A little is better than nothing and will grow over time. Keep focused, this is not the first financial crisis, if we got through the ‘70s, then we can get through this decade!!

Here are some tips that should help you get a better idea about the way forward and surviving the recession:

Open a Savings Account (if you don’t already have one)
This is the perfect opportunity for you to ensure that you have some extra cash if needs be. If you haven’t started saving yet, then the time is now to start. It never hurts to save and it might be very smart to put away a small portion of your salary every month towards the future. Think about how much you will have at the end of the month if you save $500 per day.

Exercise a Culture of Spending Less
Thrifty is in during 2009. Try to limit your spending to only the necessities. Therefore, the extra two pairs of shoes or the new Louis Vuitton handbag might not be a smart choice, especially if you have enough shoes and bags to last a lifetime. Whimsical spending is certainly unwise and will lead to financial problems in the future. Safeguard your future by ensuring that you make correct financial decisions now.

Create a Budget for the Month
This might sound impossible but you may be surprised to see the amount of money you save when you list in detail all the items you need and intend to buy for that month. If you have a budget, then it is less likely that you will do on the spot shopping. Resist the urge to buy items that aren’t already on your list. Budgeting ensures that you don’t overspend on one item and not have enough for another. It puts everything in perspective and ensures that your spending takes into account all your needs.

Do Not Touch Your Savings
Ok, so maybe you’ve been saving for five months and during that time you haven’t touched a dime. Regardless, this is not the time to dip into your savings. Unless the reason is absolutely important, then leave your savings for a time when you will need it the most. It wouldn’t be wise to spend your savings on unimportant things now, without making allowances for sufficient funds to be available in the event of an emergency.

Recycle
If you can, then it would be wise to reuse those items that you can. Bottles and small containers are ideal for storage purposes. If possible, wash and reuse as much as possible to save money.