|Gary Foreman is a former Certified Financial Planner (CFP) who currently writes
about family finances and edits
The Dollar Stretcher website
http://www.stretcher.com. You'll find hundreds of FREE
articles to stretch your day and your budget!
War is on
the horizon. What should we do to prepare ourselves? I was a young
teenager during most of Vietnam and I didn't have to make the
financial decisions for my family. What do I need to know in order
to plan for this frightening future?
Good question. How can we prepare for
uncertain times? As a long time Florida resident, I think that
hurricane preparation could provide a good example.
At the beginning of hurricane season
you don't know whether you'll be affected by a storm or not. But,
you know that it's much harder to recover from a storm if you aren't
prepared. And that it's much easier to prepare well in advance of
the storm. Last minute preparations are the hardest.
You also know that you'll need basic
supplies, good neighbors and a willingness to tough it out. And that
it's not possible to do all your preparations in one day. It takes
Preparing financially for a war is
the same. We know that it's easier to prepare before the event.
There's no one big thing that we can do to be 'prepared'. We need to
do many small things. And, even if we're untouched by war or
terrorists, the preparation won't hurt us. We should do these things
Begin with a regular savings plan.
First, because you may need it. Some workers will lose their jobs.
They'll depend on savings until a new job is found.
Second, because we may have
disruptions in the banking system. The enemy would like to cripple
the financial system. Have some cash available at all times. Your
bank could be closed for days. It's also possible that ATM's
wouldn't work and stores would be unable to process your credit
card. Remember, you can always spend cash.
Savings will also help our country.
Saved money doesn't just sit in a vault at the bank. It's loaned to
businesses to help them grow. And that growth means new jobs and
opportunities for all of us.
Some argue that consumers need to
spend more. That's foolish. You don't create wealth by spending. You
create wealth by producing something of value.
If you can, buy some stock. No one
knows what the stock market will do tomorrow. I believe that the
U.S. will come through this and be even stronger ten years from now.
If so, now is the time to buy stocks or mutual funds invested in
stocks. Over the past 200 years we've seen tough times. Yet, every
generation has been more prosperous than the one before it.
Don't panic sell the stocks you
already own. As we've already seen, the economy is resilient. It
will bend. But it's very unlikely that it will break.
A note. I'm not suggesting that we
profit from other's suffering. Owning stocks is a vote for our
future. A vote that says that our loved ones did not die in vain.
Resolve to make small sacrifices to
build up a 'war chest'. Bring your lunch to work a couple of times
each week. Give up your premium cable channels. Or cable itself. Put
whatever you save into your 'war chest'. You'll find opportunities
to use it to help yourself and your nation.
Once you have a war chest be willing
to share it with others. But, begin by being certain that your gift
is used properly. The best charities use no more than 20% of the
monies they receive for overhead and fund-raising. All charities are
required to provide you with that information if you ask.
Do something for a needy neighbor.
Many families will suffer financially. Don't wait for the government
or someone else to help them. Share your blessings with those who
Provide dinner once a week for a
family with a laid off breadwinner. Share the clothes your kids have
outgrown. Be creative. Think of what you'd need if your income were
drastically cut. Then take action.
Stockpile some groceries. You might
need to survive a week on the food you already have in your home.
Almost everything you eat is trucked in from somewhere.
Interruptions are possible. Be ready to share your supplies with
Make a friend. We're so rushed that
we don't really know the people around us. After a hurricane we all
check to make sure our neighbors are ok. Why not check on those
folks today before the storm? Your new friendship will provide
comfort today and be invaluable if times are hard.
Learn to cook more and buy fewer
prepackaged foods. Plastic starts out as oil. We could face oil
shortages. But, even if oil is plentiful, you'll make a dent in your
grocery bills by eliminating those individually wrapped items.
Think of ways to get more use out of
what you already have. It's a 'throw away' age. Perhaps you can't
fix your VCR. But you can sew a patch on a pair of jeans. Think
before you pitch it out.
Hold a garage sale. Our homes are
full of things that we no longer need. But someone does. If you're embarrassed to take their
money, give the items to a charity that will recycle them for you.