After reading some of the other posts I was wondering a few things. With the great recession going on I was wondering how many on here have changed the way they conduct their personal business. It is common for Americans to live paycheck to paycheck. How many on here were doing this before the melt down and how many are still doing it? I guess the basic question is how many people learned to reel in their spending because of this economic downturn.

Personally after we sold our house in Florida and moved to a cheaper area several years ago, the wife and I changed most of our spending habits. Prior to moving we were living paycheck to paycheck and we were "borrowing from Peter to pay Paul". I decided I did not want to live like that anymore. After we moved we paid off all outstanding loans, except my student loan from the proceeds of our house sale. We took out a mortgage to buy another house, but I can easily pay for it with just my income. I have a credit card that gets paid off every month. The credit card is only used, so I can keep our money in an interest bearing account longer and make more money. The wife has a few small credit accounts, but those are easily paid from a minimum wage job. So she still needs to work, but it doesn't need to be very difficult work. We don't owe anything on our cars, and the student loan has been paid off. My job is very secure, and I really have to try to mess up to get fired.

 

What you are doing now is what we have done for 46 years. In addition, we have always saved and paid cash for new vehicles, plus, doubled up on house payments and paid it off in half the loan time.

 

The first year of the downturn, i took a credit line to pay for things I had already oredered so as to protect my credit rating. The second year I bought minimums of anything I had to have. This year I set up a loan payment program and am discounting older merchandise to move it out and retain customers. Meanwhile I've been tightening the belt anyway I can.

 

X2 (but only 25 years).

My wife hasn't worked since our fist child was born (he's 14).

We use a CC (Chase Freedom) to pay for EVERYTHING and then pay the full balance each month. This year we've gotten two $250 reward/rebate checks and we're halfway to another one already.

 

Exactly the way it's always been done at our house. The first vehicle I ever had payments on was the last F150, and only because Ford offered 0% for 36 months.

Jim, My only regret is that we (you and I and others like us) are being forced to subsidize those people and businesses who lived at higher levels than they could afford for years and are now getting "deals" on what they owe to avoid complete financial collapse.

I'd still rather be in our shoes!

 

I definitely lived above my means when I was younger, but I don't anymore. I bought my truck for $40k in 2007 and paid it off in 9 months. I now have a year's salary in a money market fund, max out my Roth IRA each year, put a few thousand in my 401(k) because the company matches it, and I don't buy everything in sight. I'm as worried, if not more, than the next guy about our economy collapsing once all this debt has to be repaid.

Japan and China own most of our debt and what the average American fails to realize is that money is power. The value of the dollar is falling and hasn't been based on gold in eons. If the US is ever unable to repay our debts with money, the only thing we'll have left to pay with is our labor. I don't know about you guys, but I can think of more fun things to do with my time than working for the Chinese.

As my teammate likes to say...keep your powder dry.

 

I did the same thing on this truck. Financed half of it to get the $1000 Ford Credit rebate, made 2 payments, and paid it off.

I agree with subsidy statement 100%

 

Because of my line of work in the financial world I watch the value of the dollar very closely and it has actually been gaining value recently. The most consistent measure of the US dollar is the US Dollar Index which measures the dollar in relation to the value of six major foreign currencies and the dollar is currently worth more than it was last June. But you are correct that the long term trend has been down since the beginning of 2001. But it is currently about 7-8% higher than it was last summer.

However, our debt to the Chinese and other treasury holders is denominated in US dollars and therefore the Chinese want the dollar to remain strong so it will still be worth something when their notes come due.

I am just glad the entire financial system didn't collapse a year ago. We were much closer than most realized.

 

I deal mainly in foreign currency and will agree that the dollar has made recent gains. I also agree that the Chinese want the dollar to remain strong. It makes perfect financial sense for them because it's the quickest way to get a return on their investment, however I'm not convinced that there's much they can do to save our economy if we begin a freefall. I'm going to pray it never happens and do my best to be ready if it does.

 

Hmm, I have learned my lesson on vehicles for sure. At this point not really doing anything but looking for ways to not fall onto our faces. Most of it is going towards higher educational purposes so when we hopefully do get outta this mess more cash will be available.

Too bad someone can't hack into the system and just like 8 zeros onto someones bank account. I mean Im sure it goes deep so deep that someone is going to go DEEP with this but heck. Don't it just seem like its a bunch of numbers and paper?

On a heavier note, my aunt in law just lost her VP job of 27 years in a multi million dollar bis. Said she mis placed 18k worth of monies due to minor **** over the years (she delt with personel mainly). She easily made over 1M a year for the last 15 years, but the fired her on the spot for 18k. Its pretty shady the whole deal kinda a localized biz that hit the big time.

 

Everything I have is payed for, but one van. The wife and I have retirement funds, but they don't have in them what they should for our age. The market fall got us also. But if kids can get jobs when they ever get out of college, I just hope to take a deep breath. I been running the treadmill while injured for a long time.
But oyu know, now days just the month to month bills take their toll with the downturn in sales. By the time you add insurance , gas, utilities etc: , You have to keep moving fast just to stay afloat. During the good times, you just cut the checks and keep on rolling. The cqash just always seemed to be there. Now, I just say, "You gotta have some bad times, so you can remember that you did have some god ones".

 

Bluejay- We have lived the same way and if the majority of people in this country did that, we wouldn't be in the mess we are. For whatever anyone says about easy credit stimulating the economy, I say it sure does and it also stimulates inflation, foreclosures, bankrupcy, irresponsibility, wanton excesses in materialism, divorces, and certainly stimulates the sales of alcohol and aspirin. Plenty will disagree with me, but I grew up in a time when credit was EARNED, not handed out like free candy and sleep came a lot easier without the aid of a drug to attain it.

 

I do great,......if only i could get the WIFE to jump on board!!!!

 

There is simply no substitute for wisdom.

 

I recently bought a "commuter vehicle" to go to & from work! Saves me at least $100.00 a month or more in gas & I also reduced my cable bill, by taking off channels I never use! That was $87.00 a month! Total with gas saved a month about $200.00!