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Are You Prepared for Downturns in the Economy?

After work I flipped on today’s tivo’d version of Oprah and found a special episode called Money Questions with Suze Orman. Various individuals were calling into the show for advice on how to handle their money problems. The first guest, a woman by the name of Aimee, said she never worried about the state of the economy-until it was too late.

Aimee said, “We could afford to take trips. I didn’t have to look at the prices of things. I could put whatever I wanted in my shopping cart, and that’s basically how we lived.” I’m always amazed by this thought process. Although my income has tripled in the last 8 years I still clip coupons, track my spending, and constantly review my bank accounts.

Of course, I would, I’m One Frugal Girl, but I wonder how many people think clearly about their financial futures? The breakdown in the housing sector is a clear example of individuals not thinking about it. How many individuals with Adjustable Rate Mortgages weren’t expecting interest rates to rise? Now some of them are faced with losing their jobs, while food and gas prices rise.

It’s times like these that I’m grateful that my husband and I are such detailed planners. All of those spreadsheets with mortgage payments, monthly expenses, and recurring costs suddenly seem entirely worth the effort. I knew all of this prior to the downturn in the economy, but the current economy certainly reinforces that fact.