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Spending in 2009: What You Need to Know

January 13th, 2009

spending-2009-get-out-debt.jpgAmericans have become famous for spending money they don’t even have, and during this time of year many people suffer from “credit card hangover” acquired from overspending during the holiday season. This latest article from the LG Copywriting team discusses the “radical” idea of reining in excessive spending during the new year so that you will not have to worry about things like economic recessions getting in the way of your normal routine. After all, American politicians need their sheeple to maintain enough financial health to provide the appearance of prosperity and allow them room to relinquish even more of their money by the time the next holiday season rolls around.

As a nation, we are overspending and living beyond our means. It is time that we learned to find our way back to living within our means and make the transition to preparing for the future. With the current state of the economy, there is one rule for this upcoming year; you need to decrease the amount of money that you are spending. Chances are, you have a house that is full of stuff and you are adding to this collection on a daily basis, buying things that you don’t need.

One of the added benefits to cutting costs are the funds that are cleared up which can be applied to debt repayment. Creditors are raising interest rates and cutting interest lines. Now is the time to get rid of any debt that you have accumulated. Getting rid of debt is an essential part of maintaining financial health.

We are facing the highest unemployment rating in decades which causes many consumers to wonder about the security of their jobs. How secure is your job? If you lost your job, realistically, how long would your family be able to survive and pay the bills? Do you have an emergency fund? All of these aspects should be kept in mind when you are out spending your last dollars, or using credit to fund unnecessary shopping.

Cutting costs in spending can help you to establish an emergency fund. In this type of economy, savings and investments are necessary to ensure success. Every individual and family should have three to six months worth of expenses (fixed and variable) available in a savings account, in case there is an illness within the family, a job loss, or an accident.

Experts are recommending one thing, to survive; we must learn to cut costs. Our fixed monthly expenses are not the problem – the disposable income is the money that we are spending every single month. To get an idea of where you stand financially, calculate how much money you are spending each month, and then calculate the amount of money that is coming into the home during this same period. Are you overspending? Forty percent of consumers are spending more than they make, every single month which can lead to consumer debt.

How can you cut your costs within the household? There are many things that you can do to cut down the costs of your variable expenses to find money within the budget to establish your emergency fund and repay debt. Consider bundling your services such as cable, internet or phone to save each month. Liquidate your assets to fund debt repayment and establish a savings account. Each of these measures can save you money in the long run and help with your financial preparedness.

One Response to “Spending in 2009: What You Need to Know”

  1. comment number 1 by: budi tarihoran

    much i want to know on 2009 years

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