Having savings in place is a nice way to ensure that you are prepared for a rainy day but things change when a recession begins. You may have the savings in place to ensure that you financially secure through the downturn in the economy but when your income begins to decrease you may wonder if you have enough in savings to last you. It is possible to make your savings last through these devastating financial times with your savings in tact.
The most important thing to remember is that savings has to be left untouched as long as possible to make it last. When the idea of meeting the bills begins to make you think that you have to dip into savings in order to pay them then the budget must be redone to ensure that you do not. Even when you find yourself in the unemployment line it is possible to avoid dipping into savings at least until the benefits run out if you find yourself still unemployed.
The budget that you had in place can still be used with a few minor adjustments. Figuring out ways to cut your expenses down until they are at least half of the income you have each month is the first thing that has to be done. There are things that we have become accustomed to that we don’t actually have to have in order to live such as cable. Even if you are only spending around $40 a month for cable you can use that money elsewhere to help you avoid dipping into savings. If you cut other areas enough you can place that $40 a month into savings and in six months it’ll have added up to an additional $240 that you have saved.
Packing your lunch and some snacks for work or for those extended trips into town will save you those tiny amounts of money that ad up. $2 a day for coffee, $5 a day for lunch and about $3 for drinks from vending machines all add up to approximately $45 a week when you go to work. Add about $2 minimum for the drinks you buy on shopping trips and even at once a week that’s $2 you could save by packing a small cooler for the trip.
Cutting these things out when you are working takes some adjustment but when you are unemployed and trying to make savings last through a recession the $47 a week can be what you use to buy your groceries and other household needs. That $47 a week is $188 a month which at the end of six months comes to another $1128.00. That’s a lot of money. For most living off of minimum wage that will cover a months worth of bills and necessities but when you add it the $240 that was found when you cut off the cable that comes to $1368 that you aren’t spending to increase the amount of time that you have before you dip into savings.
Most have two phones, a land line and a cell phone. Cell phones are great for emergencies when you are away from home so you may not want to get rid of them but you may be able to get by without the land line. Even at just $40 a month for a land line that’s another $240 at the end of six months to bring the total that you could have saved in addition to your savings to $1608. A close look at your cell phone bill may reveal that you are paying for things you aren’t using and you can cut those out to reduce that bill as well.
Whether you choose to sign up for budget billing for your utility bill or leave it alone and reduce it each month on your own you can benefit. Budget billing allows you to know exactly what you are spending each month and some areas will adjust the amount as you utility usage changes. Other areas will have a settle up month and if you were careful enough during the budget months you can end up with a credit that allows you to have at least one month without a light bill. For instance if the budget amount for your light bills was $185 you can take that amount and add it to your savings each month that you do not have a light bill.
There is always a need for food in the home. Making personal savings last through a recession can be assisted by taking a look at eating habits as well. When ever you buy something with seeds in you can easily take out the seeds and dry them to plant. Things like watermelons, peppers, etc can easily be grown at home. You can freeze or can them to have when they can’t be gotten fresh. Even a small garden in a few containers will save money on groceries.
Recycling all those aluminum cans that you usually throw out without a thought can give you some extra income to set aside for an emergency. Utilizing local resources like the computers at the library and getting your books and videos from them for free can assist you in searching for a job and keep you entertained at no costs to you.
Beginning a recession with the goals of reducing expenses and increasing savings will make the savings you have last until the economy takes a turn for the better.