Dealing with Financial Crisis

Negative Affects of the Financial Crisis

Last year, when gas hit $4 per gallon, my husband and I finally panicked. We knew that life was going to cost us a lot of money before the summer was over, and we were right. We spent over $80 a week in gas for his truck alone. He was lcuky to get 16 MPG out of it. I had a 33 MPG car at the time and we started driving it a lot more than normal, but even that was close to $50 per week. I had at least three offers in July to buy my car simply because the MPG was so high.

To help save money, we started driving less. We live about 1/4 mile from a grocery store complex that has a liquor store, Blockbuster, and King Soopers. We started walking to the store and riding our bicycles downtown more often. We stopped renting movies every week and going out to eat. We used our Christmas money to help make some car payments so we are ahead on that.

Food prices had gone up too. I was spending $20 to $40 more every two weeks for the same items. To curb that issue, we joined Sam’s Club and started buying much of our food in bulk. Canned foods, large amounts of frozen foods, and non-perishables helped save us significant money. We started cooking larger meals and creating left overs for us to take to work so we didn’t have to out all the time. We cut back on “frilly” items that we didn’t really need. “Do we really need that?” became the question of the day if we were purchasing something. I have saved an average of $100 monthly by shopping at Sam’s.

When we looked at the cell phone bills, we realized that by having to different carriers, we were paying double every month. So we dropped my carrier when my contract ended in May and transfered me to his carrier on a family plan. this saved over $100 monthly.

Then, at the end of the year, I lost my job. What a blow that was. just when we thought we had a handle on everything despite the hard times. I started looking for a new job that same day. I hooked up with a staffing agency. I filed for unemployment (which took two hours!).

As the weeks went buy, and the news of more and more stores going bankrupt or closing completely, I became increasingly nervous. One day my husband came home and we sat down and looked at the finances. We had enough in savings to get through roughly a month and a half. We re-arranged who paid what bills, shuffled money to different accounts and paid off the credit card. Now we are scraping by with my unemployment and his paycheck, and have not lost anything yet. We are still hopeful that I get a job soon.

I think they way we had our finances set up to begin with is the only reason we are still able to survive. Between us, we have only 5 credit cards, and owed money one one of them. I was watching Oprah the other week and saw a woman who had 28 credit cards, all with money owed on them! We have hardly any outstanding debt, just a car payment and my student loans. We don’t own a home (which right now might be a good thing) and we don’t have any toys, like an RV or boat.

Our new financial plan is very simple:

1. If it is something we want and do not need, we don’t buy it.
2. The credit cards are locked away in the safe and are for emergencies only.
3. If we can ride the bicycles or walk, then the car and truck stay home.
4. if we can’t pay for it in full, we don’t need it.

Now, our only bills are the essentials to live: gasoline, electric bill, rent, car and health insurance, student and car loans, cell phone bill and food.