Before You Get Desperate

In the last few weeks, life has become uncertain for many families. Unemployment is growing, the economy is worsening, and words like ‘depression,’ ‘inflation,’ ‘stagflation’ and even ‘hyper-stagflation’ are being thrown around. Most people are looking to cut corners and spend less. Here are some tips to help protect yourself in an economic downturn and help stretch your current money in the face of rapidly rising costs.

Don’t cut back as most people are doing. Instead, cut things out. The best thing you can do for yourself right now is to not spend a penny that isn’t on a necessity. Drop your extras and cut back to the bare bones on things that you must keep. Downgrade your internet connection and cell phone and drop your cable and get a digital set converter. Watch evening TV instead of going to movies or renting movies. Make your dates free events. If it doesn’t feed you, clothe you, keep you warm or ensure your employment, try to eliminate it or use it as an occasional treat instead of a regular thing. Don’t sign any new contracts, such as gym membership or cell phones.
Buy practical Christmas gifts. Warm clothing, food that is a treat such as chocolate, gift certificates to stores that are not in threat of bankruptcy.
Currently, the food price increases are outpacing inflation. Putting your extra money into food and durable goods is an excellent investment strategy over others because they will produce more yield in the long run and ensure you have something to eat or wear. If beef prices are rising at 31% and inflation is 12%, putting the money you have into stocking your freezer is the best strategy to get a return on what you spend. Currently, a CD is only getting a 5% return on investment, so saving isn’t the best strategy at this time unless you are specifically saving in a savings account that you can withdraw from at any time to have something like an extra house payment set aside.
Learn multiple food storage strategies- canning, freezing, drying, lacto-fermenting, root-cellaring, dry-packing in a pail. That way, you have multiple methods for preserving a good buy that you might find.
Pay attention to the commodity reports. Know if a crop failure has occurred, and buy ahead to help protect you from price increases or unavailability. This is especially important if you are feeding livestock. As of this writing, sugar, beef, corn and wheat are expected to have price increases above and beyond normal food items due to shortages or market conditions. Also, know that if an item is glutting the market, it’s a good time to buy and store.
If you buy food ahead, be sure to store it properly so it does not spoil or go to waste before you can eat it.
Buy ahead for your needs. If you anticipate your children moving up a clothing size or two in the next year, go ahead and start collecting those items from Goodwill and Freecycle now.
Buy shoes, socks and underwear now. These items will be more difficult to obtain new as the prices skyrocket, especially since they are mostly imported.
Look at what you purchase regularly or what you wouldn’t want to do without that is imported. As the dollar drops, imports will automatically become more expensive in comparison to other goods. For example, in the Argentina collapse in 2001, one pack of disposable razors cost $35USD, because it was an item not made within the nation.
Start looking now at what you can replace those imported items with that is made domestically.
Begin planning a large spring and summer garden. There is a seed shortage this year, so buying your seeds now and stashing them in a moisture-proof container in the freezer is a prudent investment.
Join Freecycle and read Craigslist to find the items you need for free or used.
Turn your thermostat down. Put yourself on the edge of comfort, and as your adjust slowly work down even lower. Sleep in sleeping bags, and keep extra blankets around the living room. Slippers will help keep your feet warm, which will keep you from feeling cold all over.
Look into alternative methods of heating and compare prices, such as using your fireplace vs the heat pump.
Use drying racks instead of your dryer and cut your energy consumption as much as possible. Turn off and unplug laptops when not in use- if the battery pack is plugged in, it continues to draw power.
Compare energy usage and cost of using different appliances, such as comparing the toaster oven to the oven to the roaster oven to the crock-pot for cooking meals. Use the least costly method that produces satisfactory results.
Put an insulation blanket and a timer on your hot water heater.
Begin cutting back on your diet. See our Desperate Measures article on ideas to cut your food budget.
If you have insurance, don’t delay on getting any procedures done from a dentist or doctor that you need, in case you loose your job.
Look at beginning a small urban homestead. If you’ve been wanting to get chickens or a milk goat, now is the time to do it.
Re-evaluate your insurance needs and change your policies now if needed.
Check out money-saving books from our library such as The Tightwad Gazette in order to come up with ideas to save where you can.
Purchase and being using reusable items instead of disposable items. Keep things like paper towels only for guest use or for really disgusting messes, and use kitchen towels for everything else.