The world we once knew is gone.
Today we must prepare for our financial future within the context of uncertainty. There are wars and rumors of wars; there is strife and conflict next door, across the street, and around the globe. What happens in a remote location somewhere in the world has an effect on how we feel, what we think, and what we believe the future holds.
Here are two important questions and answers that will help you to protect your money during these uncomfortable times.
Question: With all the talk of war and terrorist chatter, and the threat of more attacks in the US, and all over the world, what are some of the things we can do to protect our money?
Answer: Great question. One of the things terror does is to stop people from doing what would be considered normal activity. The first thing we should do in protecting our money is to revert back to the basics of money management. What I call “Money Management Boot Camp Basics.”
Question: What are some of the basics we should be doing?
Answer: There are 4 essential things to do to protect our money.
1. Create an emergency fund.
Your emergency fund should be held in cash or cash equivalent, such that you can get to it very quickly; for example, a money market or savings account. The amount should be a couple (3) of month’s expenses. If you successfully reduce your debt, you can successfully create an adequate emergency fund very quickly.
2. Reduce your outstanding debt.
If you can refinance major purchases in order to reduce payments, look into it. While lowering your interest rates, you can use the savings to pay the loan off quicker. If unable to lower payments, try to increase payment in order to pay off quicker. The key is to have low debt. In hard financial times, having lower debt is important for future success.
3. Curb unnecessary spending.
Plan your purchases. Make sure that the money you spend, you receive good value in return. Use a spending journal to track purchases and to plan future spending
4. Plan for contingencies.
Make sure you have adequate insurance, estate plans, and that your will is in order. This is not only good sense in times like these, but at all times.
Preparing your finances for war requires you master the basics. By following the steps above, you will insure your flexibility, agility, and ability to survive in this brave new world.
Todd A. Williams is an author, educator, and public speaker who is quickly becoming a leading voice in the area of money management. Sign up for his free e-mail newsletter at http://www.moneybytodd.com
