Get A Handle on Your Financial Situation
Hopefully you’ve been able to stash enough cash in your emergency fund to last you through a downturn. Typically it’s been recommended that you have at least 6 months’ worth of expenses to tide you over. But these days, liquidity is king! If you want to be absolutely certain that your expenses are fully covered if you DO get laid off, then you’ll have to rethink how much cash you should hold. Where to put this money? Somewhere ultra safe, such as a high yield savings account.

  1. Do a budget. Download free budgeting forms. Be honest about your family’s must-haves—food, shelter, utilities, transportation, and basic clothing. If you have credit card debt, talk to your credtors to see what options you may have.
  2. Cut way back on your lifestyle. Home-cooked meals and library books should become the norm. Rent m ovies from the kiosk for a buck a night. Take advantage of public parks, low-cost museums


  1. Get a part-time job. Yes, they are available. Do everything you can to still generate some income until you find a new full-time job.7. Diversify.

Diversification is not just for investments. It also pertains to income generation and wherever else you may be spending your time. If you’ve got other ways of making money other than through your job, you’ll be in much better shape when a recession hits. So if you’ve got talents and skills, or that perfect hobby you can parlay into a business, you may think about leveraging these things into money making ventures and alternative income streams.

Guide 6: Talk to the people you owe money to. Don’t ignore bills or you may lose what you already have. Immediately contact your creditors: the finance company, bank, credit union, and department stores. Make an appointment to explain your problem. Here are some solutions you and your creditors might work out:

• Make smaller payments that you can afford for a short period of time.

• Refinance your loan. You can make another contract for smaller payments over a longer period of time. The new payments will be smaller, but the overall cost for the loan will be larger.

If all else fails, consider a consolidation loan. You can take out one loan to pay off all your bills at once. Then you will have just one debt to pay off to just one creditor. Each payment will be smaller, but you will commit yourself for a longer period of time, usually at a higher total cost.

Don’t forget to work out a way to handle your monthly mortgage payments. If they are too high for you to pay, go to your lender and explain. Ask the officer in the mortgage-lending department to permit you to pay only the interest for a certain period of time. Or perhaps you can postpone one or two payments until you have pulled yourself out of your financial crises.

The important thing is that you talk with your creditors about your problem and come to an agreement about what you can do and keep from losing what you have.

• Don’t default on payments. Go to your creditors, explain your situation, and work with them to make adjustments.

• Be prepared to change your standard of living, at least temporarily, so you don’t have to give up essentials.

Hunker down and cut expenses.. coupons, reduce cable commit, Dish Network lets you do it ($5 change fee, which I think is reasonable), hopefully your provider will without a ridiculous change fee.

figure out healthcare–COBRA may be your only option

  1. Take pictures

Put your $1,500 dSLR to use by selling stock-art pictures of household objects to Fotolia, ShutterStock, iStockphoto, StockXpert, etc. “It’s cheap for people to buy images compared to the traditional stock (photo) market, but it can be lucrative over time because images sell over and over. I’ve made money without trying too hard. But quality standards are going up, so you can’t just upload any old crap. Brush up on your model releases.”

Virtual marketplace sites—like,, and—link up freelancers who have specialized skills (like video editing, blog writing, or Web developing) with employers by having candidates bid for jobs. Grumblers complain that they’re competing with offshore workers who give lowball figures to win assignments.

Refuse to be unemployed. If you’re a programmer or IT professional, don’t think of yourself as unemployed, think of yourself as an independent contractor and go get some work. I loved the freedom of consulting the 18 months I did it. I didn’t like constantly scrambling for the next gig. You might enjoy it enough to just consult forever.