Has the Recession Ended

The unemployment rate is now 9.8%. Several banks and financial institutions went out of business. Over two million foreclosures and counting. Over one million personal bankruptcies as of September 2009 and counting.

This is the longest recession in the history of the country which lasted for 18 months. The next longest recession lasted 16 months. The recession officially ended in June 2009. Some signs that the recession ended are:

1. Shares price began to increase
2. For the past two months there have been less employee layoffs and unemployment filings
3. Some businesses are getting stronger
4. There was a slight increase in sales of manufactured products
5. The Americans savings rate is positive
6. Economic issues developed in other countries
7. Value of the dollar has begun to increase
8. The price of gas is going down

The recession is over but if you find yourself still having financial troubles that is a sign that you have to change the way you think about money and you have to change your spending habits by living well below your means. Here are a few ways to help you live below your means and ensure that you are able to survive a future financial crisis:

1. Bring your lunch to work
2. Pay down debt
3. Create a budget or spending plan
4. Reduce spending
5. Create an emergency fund

Is Your Stubbornness Keeping You In Debt

Many people say that they don’t have any extra money to pay down debt and improve their financial situation because they are used to living a certain lifestyle and want to maintain that lifestyle. However, when they record all of their expenses or consult a financial advisor, financial coach or personal finance expert the picture changes.

Many people are in shock about how much money they actually spend and what they spend money on. The first step to overcoming a problem is admitting that you have a problem. The second step is developing a plan to overcome the problem. This is the step where many people have difficulty when it comes to finances because many people are stubborn and don’t want to make any changes.

Many people know they are in debt but don’t want to change their mindset or their lifestyle to do what it takes to improve their situation. Americans as so accustomed to instant gratification and buying on impulse it’s difficult to change that behavior especially when you were not taught about financial literacy in school or by your parents.

You can’t continue doing the same thing day after day expecting a different result. The only way to survive this recession is to make a change. It is a horrible feeling to be in debt, live paycheck to paycheck or be unemployed. I have experienced all of those and I vowed to myself not to be in those situations again or if I was, develop a plan to ease the burden during those difficult financial times.

Here are 5 tips to prevent your stubbornness from keeping you in debt:

Admit. Admit you have a financial crisis. Discuss with your spouse, partner and children about your situation, be honest. Once you admit you have a problem it is much easier to get or solve the problem.

Budget. Create a budget by recording all of your expenses and monthly income. List everything you spend money on during a month including variable expenses such as yearly or quarterly bills. Include monthly debt payments and loans in your budget. If you have 5% of your total income or less left each month you definitely need to adjust your spending.

Reduce. Reduce your expenses to free up extra money. Shop at discount or wholesale stores, get the cheapest cable, cell phone, satellite radio or internet services available or cancel them. Buy groceries in bulk. Shop for clothes at Target, Walmart, thrift stores or discount stores. Turn off lights and electronic devices if you are away from the room more than 20 minutes at a time.

Turn the tv off. If you or your family spends a lot of time watching tv, reduce the hours spent watching tv which will reduce your electricity bill. Go for a walk, play games with your family, read a book or find a new hobby.

Change your mindset. Many people have negative thoughts about money and this causes them to continue to be in debt and prevents them from being able to improve their financial situation. Eliminate the negative thoughts such as: “I will always be broke, I will always be in debt, I will die broke”, etc. These thoughts prevent you from being able to develop a plan to improve your financial situation.

Make one small change at a time and over a period of time your situation will improve. You will have less stress, less fights at home and you will be a role model to someone else by being able to give them advice on how to overcome a difficult financial situation.

Are We Really in a Recession

I went to a few events this weekend and kept asking myself, are we really in a recession. In a recession how are people supposed to act. Should they live on a budget, stay at home all the time, only go out for special occasions, cut back on a few items, or live like there is no tomorrow and worry about the consequences later.

This weekend I saw many people spending lots of money and wondered, can they really afford to spend that money or are did they just get caught up in the frenzy of the 4th of July holiday and advertiser sales. How will they feel when reality hits and they receive that credit card bill or when they go to work on Monday and don't have any money to get to work or pay that unexpected bill that comes in the mail next week. These are just some of the things I pondered while I was out.

All of my friends and family know I am frugal, not cheap, I like nice things but if I can buy something at a cheaper price why not? I don't spend too much money on myself during the week, just $1.59 for grits Monday through Friday which equals to about $7.95 a week.

I also got caught up in the revelry and while out with several friends picked up the tab, not to show off, but merely as a kind gesture to those who have supported me with my business and who continue to support me and because I am blessed. I felt good knowing that because I live on a budget, only have my mortgage payment, my car is paid for, have a savings account and a retirement account I can at any time splurge on anything I choose because I live well below my means. I don't have to panic because when I receive my credit card statement because whatever charges are on there I can pay them off. I won't cringe on Monday morning because I still have money in my pocket and I don't have creditors calling my house harassing me.

I also have health, life and disability insurance which helps if you get sick or are unable to work for an extended period of time due to illness. This eases the burden of the high costs of medical care and ensures that you don't go into debt due to illness and prevents you from filing for bankruptcy due to high medical costs.

I hope everyone enjoys this holiday weekend. I wonder how you will you feel on Monday - depressed because you spent all of next week's money this weekend or will you feel happy because you are aware of your reality and spent your money wisely this weekend.

More Jobs Lost in November 2008

If you are still asleep or living under a rock wake up! It has been confirmed that we are in a recession and have been since December 2007. Based on this announcement by the National Bureau of Economic Research we have been in a recession for 12 months and counting. According to expert economists, the recession will last at least through the middle of 2009 and the economy is getting worse by the day.

The private sector industry eliminated 250,000 jobs in November. There will be additional private sector layoffs at least through the end of the year. Citigroup plans to layoff 50,000 employees. They have had 220,506 job cuts so far in 2008. The 3 major auto companies, GM, Ford and Chrysler are on the verge of bankruptcy or failure in addition to many stores closing or going bankrupt.

Although gas prices have gone down to below $2.00 a gallon the continued job layoffs will greatly affect this year's holiday season.

If you have not already done so, now is the time to change your spending habits and your lifestyle. Buy items on sale, in bulk, eat more casseroles, soups, ramen noodles, tuna and sandwiches, for lunch and dinner, bring your lunch to work and buy only necessities. Live at least 30% below your means to ensure you are able to survive the recession. It is going to be a long winter season.

6 Ways to Recession Proof Your Income

The Federal Reserve has dropped interest rates 2.25% points since August 2007. There were approximately 700,000 foreclosure filings in 2008. Congress is trying to combat the recession by giving Americans tax rebates. Oil prices are over $120 a barrel and gas is $4 or more a gallon. Food prices rose more than 4% from last year. With the high cost of gas, food, housing, utilities and travel costs you have to develop a plan to ensure you can sustain yourself through the current recession. Here are 6 ways to ensure you survive the recession.

1. Find stable employment – Many companies are having layoffs or reducing salaries or employee hours. To protect yourself, if you are a contractor or a seasonal employee try to find a stable job or get a part-time job to get additional income. Do research on a company to see their annual finance report, see what the company's plans are for the future and ask others if they have heard about the company to ensure you are working with a stable company. If you hear rumors of layoffs dust off that resume and start looking for a new job.

2. Reevaluate your finances – If you don't have health, life or disability insurance consider getting at least basic health insurance. Health costs are one of the biggest reasons for filing for bankruptcy and bad credit ratings. Get life insurance to at least cover funeral costs and cover bills for a few months.

3. Pay down debt – A balanced budget should consist of no more than 15% of your monthly income to pay monthly debt such as credit cards or student loan (this can vary based on your income and does not include rent or mortgage). Start small and pay off small bills first then work your way up to pay off larger debts. Double the minimum monthly payments when you can to pay down debt faster.

4. Create a budget or spending plan – create a budget and write down all of your monthly expenses and bills and your total monthly income to quickly see what you are spending your money on. Find ways to reduce expenses. Include savings goal in your budget and save enough money to cover at least 3 to 6 months worth of expenses.

5. Reduce Expenses – reduce your expenses one step at a time. Start small by taking your lunch to work, skipping that Starbucks Latte and bringing your coffee from home, use coupons or buy items on sale to save money. All these little things add up and will give you extra money to pay bills or pay down debt.

6. Don't avoid overdue bills. Many companies are desperate for money and may not follow the proper procedures to collect on a debt. They may file for judgment against you without ever notifying you. Call your creditors right away to setup payment plans to get current on old bills and prevent harassing calls or letters and damage to your credit report

Following these 6 tips will ensure you survive the current recession.

5 Ways to Survive In This Economy

We have had recessions in America in the past which has affected various industries such as agricultural and manufacturing. The last recession we had was in 2001. There have been 8 recessions in the past 40 years and since 1945 there have been 11 recessions.

The shortest recession lasted 6 months while the longest lasted 16 months. A recession is defined by Webster's as: an extended decline in general business activity, typically two consecutive quarters of falling real gross national product (GDP) or the state of the economy declines; a widespread decline in the GDP and employment and trade lasting from six months to a year.

The economy is classified as being in recession only if there is a widespread decline in the economy that includes an overall decline in production, employment, personal income, industrial sales, and total manufacturing and trade sales. The decline must be long enough to be classified as "substantial and significant." This recession included industries such as housing, oil, employment and manufacturing. We know we were in a recession because:

1. Shares price dropped sharply
2. There were frequent employee layoffs
3. Several business went bankrupt
4. There was a rise in unemployment
5. There was a decline in employee income
6. There was a decrease in sales of manufactured products
8. Americans received an economic stimulus package refund
9. Interest rate reductions by the Federal Reserve z times in the past x months
10. There was an increase in negative savings rate
11. Economic issues developed in other countries
12. Value of the dollar sharply declined
13. ising costs of products or services

Here are 5 ways to protect yourself during a recession:
Protect your investments - call your broker and adjust your portfolio to limit the effects of the recession and money lost during this time. Ensure your portfolio is adequately diversified.

Stay calm - don't make rash decisions based on your emotions. Before making any changes think about your situation and wait one or two days and think about a solution. Get advice from friends or family members who have previously had financial crises.

Reevaluate your existing mortgage loan - review your existing mortgage loan to see if you got a good deal on your mortgage loan. If not, it's time to refinance to a lower fixed interest rate that will provide a level of stability to help you get through these difficult times.

Reduce your debt - create a debt payoff plan to identify the total debt owed, the minimum monthly payment and balance on each account. Create a plan to pay off each bill and find ways to reduce expenses to get extra money to pay down debt.Update your resume - if you are currently employed and as a general rule of thumb, each time you start a new job or new position with your existing company revise your resume. Update it at least once every 6 months. Take training class or learn a new process or skill at work to make yourself seen as a valuable asset to the company. Also, begin networking with staff outside your department to make alliances to staff that can provide leads, and other information on finding a job.

Good luck!