Surviving during challenging financial times requires a new way of looking at money and the world. In fact, the ability to survive on a modest income is a skill. It requires vigilance, discipline and quick-thinking.
Indeed, it’s a skill that could be useful for anyone, especially in these uncertain economic times.
Even if you’re great with money in general, you might not have the expertise to live on a low income, and such expertise could come in handy.
Practice these skills and you’ll be prepared to survive any financial challenge:
1. Be able to differentiate between wants and needs.
What you consider to be a need will change when financial resources are scarcer. Before spending any money, ask yourself if the item or service is a true need or a want.
Do not be carried away by the endless commercials and their subliminal pressures that sometimes make you think you can’t live without that latest gadget.
2. Develop the Skill of Saving.
Saving is often a challenge during good times. We feel like since the money is flowing, we just need to keep spending. Ironically, saving is even more challenging when money is tight.
Therefore, simply develop the habit of saving a portion of any income you earn, in good times and in hard times.
The rule of thumb is to put away 10% of your gross income every paycheck. It’s even more important if you can do that through an auto system, and before any bills are paid.
3. Know how to budget and have discipline.
Just about anyone can create a budget, but it’s sticking with the budget that’s hard. It takes practice and discipline. It’s no fun to barely scrape by each month, but a budget makes it possible. It also highlights the little ways to get ahead each month.
4. Cut energy cost.
Learn to control the energy use in your home – heating or cooling. Winters are getting increasingly brutal, and if you don’t learn and practice energy conservation, the bills can eat a big hole in your pocket. Winterize you home, and explore alternative heating sources.
Likewise, learn to cut your automobile gas use. Combine trips. Organize a carpool to minimize driving to work. If possible, use a bike or walk. Use public transportation if you can.
5. Find an additional source of income.
A part-time job can be a big help. There are many things you can do on your own instead of seeking additional employment. You can rent out your car, rent a room in your home, buy and sell items on Craig’s List or eBay, or any number of other activities.
Read the articles in the “Fire Your Boss” category of this website for ideas on starting different kind of business.
6. Shop Consignment and Thrift Stores.
You can find good bargains at thrift stores. You can find brand name clothing and items of furniture at very affordable prices at consignment stores. Unless you tell people where you bought them, thrift and consignment are smart shopping strategies for surviving challenging financial times.
7. Know what public assistance programs are available to you.
Medicaid, welfare, food stamps, heating subsidies, and the Affordable Care Act are just a few programs that are available in most areas. If you’re used to living a middle-class lifestyle, you might not have the slightest idea of how to take advantage of these programs. Become familiar with what all that is available in your area.
- Most areas have employment assistance or job training programs to help you find work.
- You can also receive a big tax break if your income falls below certain levels.
- Or be eligible for housing assistance
The less money you have, the more scrutiny each dollar requires before it’s spent. If you find yourself with less income than you’re accustomed to, it’s important to aggressively conserve at every opportunity.
Challenging times require a new set of skills.