By necessity, local businesses and residents have tightened their belts and are delving into savings to get through these tough times.
These are good short-term solutions, but the important question is what will be the lessons that endure once the economy changes from downturn to recovery and eventually to growth and prosperity?
I've been in banking for almost 40 years and I've seen many recessionary periods and times of great prosperity. The common denominator in any economic cycle is that planning for the future is fundamental to achieving your financial goals.
I'd like to share my years of experience helping customers manage through tough times to achieve financial success. In a weakened economy, I think we could all use a refresher on the fundamentals of personal financial management. I've learned tough lessons from a weak economy, which are described below.
Avoid indulging in excess spending that doesn't help to create wealth. Instead, make small, scheduled contributions to your retirement or IRA account to ensure future income when you are no longer working.
Get out from underneath the financial burden of credit cards as quickly as possible, especially those with high interest rates and fees. Selectively choose the credit card you use to benefit from cash back or rewards
programs.
Make certain you provide for some savings for that next rainy day, your rainy day fund isn't the retirement account. Again, small contributions to a savings account build up over time and it won't encumber your monthly cash flow.
The discipline of putting something aside each month will go a long way to help you accumulate your wealth.
Have a plan and a budget. Stress test your personal or business budget with a 50 percent drop in income or revenue and see what would happen. Stress test with the loss of your two largest customers and see what will happen. Will your rainy day fund be sufficient to get you through six months or a year?
Thoroughly analyze investment opportunities before making a financial commitment. If it's too good to be true, it probably is, stick with your intuition.
When under pressure to make a decision, get a second opinion from a neutral party, like your attorney, banker, CPA or other trusted advisor who has your best interest in mind.
I'm confident the economy will recover and the good times will roll again. Until then, how we manage through the times depends on how we plan for them.
My advice is pretty basic, but it will keep you away from the financial fringes that so many people are clinging onto.
For more information, call (760) 444-8400 or visit www.torreypinesbank.com.
These are good short-term solutions, but the important question is what will be the lessons that endure once the economy changes from downturn to recovery and eventually to growth and prosperity?
I've been in banking for almost 40 years and I've seen many recessionary periods and times of great prosperity. The common denominator in any economic cycle is that planning for the future is fundamental to achieving your financial goals.
I'd like to share my years of experience helping customers manage through tough times to achieve financial success. In a weakened economy, I think we could all use a refresher on the fundamentals of personal financial management. I've learned tough lessons from a weak economy, which are described below.
Avoid indulging in excess spending that doesn't help to create wealth. Instead, make small, scheduled contributions to your retirement or IRA account to ensure future income when you are no longer working.
Get out from underneath the financial burden of credit cards as quickly as possible, especially those with high interest rates and fees. Selectively choose the credit card you use to benefit from cash back or rewards
programs.
Make certain you provide for some savings for that next rainy day, your rainy day fund isn't the retirement account. Again, small contributions to a savings account build up over time and it won't encumber your monthly cash flow.
The discipline of putting something aside each month will go a long way to help you accumulate your wealth.
Have a plan and a budget. Stress test your personal or business budget with a 50 percent drop in income or revenue and see what would happen. Stress test with the loss of your two largest customers and see what will happen. Will your rainy day fund be sufficient to get you through six months or a year?
Thoroughly analyze investment opportunities before making a financial commitment. If it's too good to be true, it probably is, stick with your intuition.
When under pressure to make a decision, get a second opinion from a neutral party, like your attorney, banker, CPA or other trusted advisor who has your best interest in mind.
I'm confident the economy will recover and the good times will roll again. Until then, how we manage through the times depends on how we plan for them.
My advice is pretty basic, but it will keep you away from the financial fringes that so many people are clinging onto.
For more information, call (760) 444-8400 or visit www.torreypinesbank.com.