Thoughts.com Blogs - The "D" word....

View Blog

The "D" word....

My last blog was about the recession (you know, the one that our president refuses to acknowledge?) and how to cut spending. This blog is going to deal with something that most of us have only read about in our history books, but seems like a very real possibility threatening our present-day society, and quite possibly our future for years to come: another Depression.

If you were to talk to anyone old enough to remember our last Depression, they'll tell you that there's another one lurking right around the corner. The signs are all in place: crashing housing market, decreased value of the dollar, rapidly falling stock prices, increased prices on fuel and food,and the Federal Reserve bailing banks out of debt. In this day and age, we also have to look at the global economy, which is also showing the signs of rough days ahead. I just read an article online yesterday that the country of Malasya (forgive my spelling, if incorrect) has been urging its people to stockpile food since Janurary. Unless you've been living under a rock for the past few months, you can't ignore that things are getting very bad.

All this financial disaster talk has lead me to think about my own family's survival. Would we be prepared? Do we have what we need in place to deal with tough economic times? I think all of us should be giving this some SERIOUS thought.

A Depression of today will look a little different than it did back in the 1920's. All of us will feel the effects, but the people the most effected will be lower income families, and people with lots of debt. Food will become very expensive to buy due to increased fuel prices; and unemployment will be high.

With that being said, I think it's important to take a look at what we'll need to get through those times. What are the most important things to consider? Housing, heat (for us northerners), water, and food. Anything else will become unimportant. These are the things we'll need to survive-the necessities of life.

If you're not paying down any debt you may have, the time is NOW. The less money you owe to other people, the more money remains in your pocket. This will take on a whole new meaning. Take a look at where your debt is. Is it credit card debt? If so, this should be the FIRST thing to go. Credit card debt is an easy way to lose your money. Pay it down, pay it off as soon as possible, and stop using them. No piece of clothing or dinner out is worth paying for for months at a time: ESPECIALLY NOW. Priorities need to be re-examined. Take a hard look at where the money is going, and cut all unnecessary spending. Apply that money towards your debt.

Next, take a look at what you're paying for housing. If it's difficult making the payments, you may want to consider finding cheaper housing. I know that may sound harsh, but this is a big reason why houses are being forclosed on in record numbers. People have over-spent for too long, and now it's catching up to them. Examine this possibility. If your mortgage/housing cost is manageable, this should be another area in which you should pay down as quickly as possible. For us, this is the biggest bill that we have every month. We have been on a bi-weekly program throughout most of the life of our mortgage. Doing that will save us from paying 7 years of interest. So instead of paying for 30 years, we'll only pay for 23. My husband and I are going to shave some more time off that. As soon as we are in a position to do so, we will be putting as much extra on that mortgage as possible.

Next on the list, for anyone living in an area where it's cold for a part of the year, is heat. If you are heating with any kind of fuel, it is imparative that you consider an alternative heat source. Is it possible for you to have a wood stove? Do you have a fireplace? Next season would be a good time to start using it more. If this isn't a possibility, consider going on a budget plan for fuel delivery. This can prevent having to fork out a $600-700 bill all at once when they bring you fuel. In the meantime, check your insulation in your home. Consider upgrading and insulating as much as possible. This helps to keep more heat in your home. Do as much as you can on your own.

Water needs to be discussed also. If you have well water, you don't have any worries. If you depend on someone else for your water supply, it may be a good idea to consider buying a few gallons of bottled water. The experts tell you to plan for a gallon per person per day. Add a gallon (or one of the 5 gallon jugs) to your grocery list and after a couple of months, you'll have a good supply. If you don't think it's enough, then buy more. Buy it until you run out of storage.

Lastly is food. Stocking up on staples makes good sense right now. Concentrate on whole foods: flour, sugar, coffee, meats, produce, oats, and spices. Find local sources for as many of these as possible. I do believe that the grocery stores will suffer the chaos, too. Shipping food country-wide will become difficult due to fuel costs. What food does make it to the store shelves will be expensive. Find a local farmer for your meat supply and eggs; head to your farmer's markets and buy extra to freeze; or better yet grow your own garden. Even if you only have room for a small one, you'll know that at least SOME of your food was self-raised. Learn to eat what's in season. Break your habit of buying strawberries in January or blueberries in October.

How long do you stock up for? That is a good question. Some people say a few weeks, some a few months, and there are even more yet that say that having a year's worth of food isn't a bad idea. I don't have a sound answer on that, but I will tell you that I'm going to shoot for 6 months worth. If you plan accordingly, eat simply and seasonly, and buy in bulk, the overall cost should be tolerable. Buy a little every week, check your sales flyers, and buy locally for the rest. Learn to do without some things that aren't necessary in your diet.

It's not healthy to be an alarmist, but it's good to be prepared. It would be awful if you found yourself in a position where money was tight and you needed to feed your family and found the supplies were scarce. Better to be safe than sorry. And hopefully, I'm wrong. I hope I am. If so, then no harm done. I'll have plenty of food so I won't have to buy much for a while. But if I'm not, at least I'll know we'll eat, and we'll be warm.

Give it some thought....