The Economy and you..

qdognjJanuary 29, 2009

Have you personally been affected by the economic downturn? Or just pulling in your expenses because you "fear" the unknown? I guess simply put, Perception or reality..

The following link to an article shows the "trickle down affect" of a layoff,which is reality,but i wonder how much "perception" of the economy is doing the same

Here is a link that might be useful: trickle-down affect

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Have you personally been affected by the economic downturn?
Nope, not at all.

Or just pulling in your expenses because you "fear" the unknown?
Not that either.
But then, we have always lived within our means, paid ourselves first, maxed out retirement accounts, etc. So there is nothing to change.

Plus, here in the Pittsburgh area, home prices actually increased during the past year. We did not have the 'bubble', so we had nothing to 'burst'.

    Bookmark   January 29, 2009 at 12:57PM
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Our personal income has not changed, but our 403b is down 40% and we took most of our cash and went way out on margin on rental properties. We did that because we can't see how the government can make good on its obligations except by allowing massive inflation. The combination of a reduced retirement nest egg, the reduction of cash and a 600k debt has made me more nervous. I am being a bit more careful in what I spend, but we have always been pretty frugal. We never eat out or go to a movie etc. I am getting my hair cut less often - but then I worry about how the hair dressers are getting by and I think I am wrong to make those economies. I am also trying to give more to charity, but it is hard to know which, of all the areas feeling a pinch, are most deserving of help. My husband is coming up on retirement age, so we have to save pretty hard to re-build are finances. The rents we are getting now are paying the mortgages, but I worry about the future. So I guess, all in all, we have been bitten by the fear bug too - or is it the prudent bug? So hard to know the difference.

    Bookmark   January 29, 2009 at 2:27PM
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The fear paralyzing the economy,imho, is worse then the greed that came before it..The EMPLOYMENT rate is still 92% +-,and even if it reaches severe recession levels,it still would be near 90%...As people cut back on everyday expenses it serves to make the downturn that much more severe, as cutbacks in turn cause more cutbacks...I agree with Devorah about the government "attempting" to inflate their way out of this problem, but unless confidence is restored asap,deflation will be the bigger concern,particularly over the next 12-18 months..Eventually,inflation will come roaring back

    Bookmark   January 29, 2009 at 3:24PM
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Personally - The company DH works for was bought out and now his location is closing. We have always been practical with our expenditures and now will be a little more frugal. We are a few years from retirement age so we had been paring our expenses down but this will create more expense when we buy health insurance. Our 401K is down too, as I would imagine the majority are, so getting income from that is not available. Small town, not likely any jobs forthcoming in this area. Trouble is, even in larger towns, lay-offs continue.

The trickle down of money the government is bailing out the large companies is not going to work. It is like giving a bonus to those who could not do their jobs. Extremely vicious cycle: less consumerism due to less jobs, cause a decrease in employment, equals less consumerism AND taxes both in absence of payroll and in sales. Less Taxes = less beneficial services; = higher taxes on property and inflation. This is definitely not a solution.

The people will have a huge financial burden in the form of government debt with fewer people working and spending. Ironically if the money had been given to the people, the people would be spending, paying off credit and other debt - increases credit available for housing, cars, etc., requiring the need for more hiring to build them, and would be an influx in taxes paid and would trickle up. Those poor CEO's who couldn't manage their companies might actually have gotten booted out the door in stead of retiring with huge benefits.

This is from Consumerist on how bad the economy is (VA area)- a reader and property manager in Virginia posted a notice for a part-time evening receptionist, and in response to the 12-hour a week job, she got 3520 emails. Roberta writes, "The attached picture was my email in-box this morning, with 0 spam emails and 0 non-Craigslist emails. 3520 (and climbing as we speak)..." Perhaps this can become a new metric to gauge how bad the employment situation is, how many resumes a 12-hour receptionist-job posting on Craigslist receives in a 24-hour period.

    Bookmark   January 29, 2009 at 3:45PM
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qdog, If you want to see reality, pay a visit to your local unemployment office one day soon. Get there about 1 hr before the office opens and stay there for just 2 hours. You'll see all you need to see. Monday is the best day to visit.

There is no way that confidence is going to be restored quickly IMO. I define quickly to mean this calendar year.

    Bookmark   January 29, 2009 at 4:13PM
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kec01, i don't doubt lines are long at unemployment offices,BUT employment is still over 92%, so while there are 8 out of 100 unemployed,92 out of the hundred are still employed(though some are clearly underemployed)...and if we use 4% as the "norm" for unemeployment(and that number is low),only 4 out of 100 have joined their ranks..

I will note that jobs are getting cut daily,but a lot of fear or lack of confidence is taking its toll on the economy,its not just the unemployment rate doing such

    Bookmark   January 29, 2009 at 4:22PM
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tishtoshnm Zone 6/NM

I work for a national medical transcription company and I was part time. They changed it to where all part time employees were limited to 20-25 hours per week whereas before you were allowed up to 36 hours. I was able to change my schedule to full time but now I work really bad hours and do not always have enough work (I am paid on production). It would seem that fewer people are scheduling surgeries or even just visiting their doctors. Volumes are quite low.

Dh works for the state. Our leglislature is meeting right now, trying to figure out how to correct a huge deficit. I am certain there will be no raises right now. I am scared that they may be increasing our contribution to health care, etc, to help make the ends meet. How much we will be affected is in wait and see mode right now.

My son attends a special needs preschool program through the public system. The color ink cartridge ran out and the teacher was told that she would be responsible for replacing it. She has taken a collection from parents to help cover the costs. These are a few ways that we are being personally affected.

    Bookmark   January 29, 2009 at 5:04PM
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We've been affected. Our DS works for one of the largest pharma/medical equipment companies in the world. DS has been working a small niche territory for the past 3 years. In Dec. '08, at the national convection, he was recognized as one of the top company performers in the US. But, the company decided to consolidate territories & gave DS the option of taking over a large territory in another state or losing his job...well, guess which option he chose? They gave him only 30 days to get moved & start working the new territory. They moved the day after Christmas. Their house is on the market but its unlikely it will sell anytime soon. The good news is that it's a productive territory & DS has already met his quarterly goal. It's a significantly lower cost of living area so they're able to rent a nice house on 5 acres & still manage the mortgage payment on their for sale home. The bad news is that I miss them! They're now an 8 hour drive instead of 2 hours. They're coming to spend a week at Easter where we used to just get together for a Saturday afternoon.

We've been reducing our personal spending for the past 2-3 years anyway since we're nearing retirement. We'll continue that reduction in '08. I'm more into getting rid of 'stuff' than acquiring more.


    Bookmark   January 29, 2009 at 5:27PM
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^^ Well, that's a BIG PLUS!

DS still has a job; the territory is productive AND the COLA is lower.
Good for him!

    Bookmark   January 29, 2009 at 6:31PM
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tricia, from a personal standpoint,it truly has affected you as your son is no longer close by..BUT, from a financial standpoint, i think the company recognized your DS's talent and ability and rewarded him with a bigger job!!Lower cost of living is a bigtime plus, particularly if his salary and compensation increased...2 hour drives are not that convinient,so if they visit for holidays,that is very good....I say congrats are in order, not despair :)

One last question, didn't them give him some type of relo package?

    Bookmark   January 29, 2009 at 7:17PM
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In reality I have not been affected yet. I'm the textbook case of someone hunkering down and not spending though. I just can't see spending money right now on anything I don't need. And I don't need anything other than food, gas and utilities.

There are a few "frivolous" things I still spend money on that just bug me but I tell myself - you do not need to cut back on these things unless you or DH loses your job. And even when we've had one income we typically haven't had to cut these things. I'm talking about things like cell phones, landline phone (at two houses), cable TV (we have only basic but at two houses), housecleaner (one house) and hair salon. This stuff adds up.

So I'm having a talk with myself almost daily saying it's good for the economy that I keep spending on this stuff. I think this is so funny because I had these conversations with myself in high school in the late 70's recession. I worked and liked to save money but I liked to buy a few things too. When I was torn about spending or saving I'd tell myself it was good for the economy if I went shopping!!

But life was much simpler then. I didn't own two homes or even think twice about my retirement savings. It all weighs much more heavily on my mind now even though I have no debt other than one modest mortgage and I have enough liquid savings to live several years if we both lost our jobs.

I think it has something to do with hearing about the depression from my parents and grandparents and watching the movie Kit Kittredge on an airplane in October as the stock market imploded. That movie has had a lasting impression on me. I personally think people are delusional who think this is just going to be another typical recession. I think it's going to be another depression that will last for years and I feel the need to save as much as possible to minimize the impact. My thinking is probably also affected by the fact I grew up in a family with very limited financial means and I would really prefer not to return to that kind of lifestyle ever again in my lifetime.

    Bookmark   January 29, 2009 at 7:28PM
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Hasn't affected me and probably won't unless the market crashes and the banks fail like years ago.

    Bookmark   January 29, 2009 at 10:03PM
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It hasn't affected me either, but I know that it could. That bothers me, but not to the point that we have changed our way of living. If and when the time comes we will cut back and be alright. I think the media is frightening people and making matters worse.

    Bookmark   January 29, 2009 at 10:15PM
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I still maintain the 7.2 - 8% unemployment rate is misleading as it only accounts for those on the unemployment rolls, signed up for and receiving benefits - doesn't track the underemployed, those who have fallen off the rolls and through the cracks. The talking heads estimate it's really at least twice the aforementioned figures.

Am I affected? No. I'm retired and no longer in the rat race of fearing downsizings, buy-out packages, departments being eliminated, trying to remain essential and flying under the radar. Aside from basic goods and services costing more, or costing more but getting less, I don't personally feel much has changed for me. I still get my pension, interest and dividends and my untapped 401k, actually it's a 403(b), hasn't lost a penny so far, and in today's climate having it grow at a whopping .052% is a Godsend. There's some value in getting older and less tolerant of risk. My brokerage accounts are another story, but I'm willing to ride it out. Stocks are down but still paying out dividends and in some cases even raising them.

If it were possible that we had the confidence, ability and national will to spend to get money circulating, I would spend. The problem is, I don't need anything and even under pressure have a hard time coming up with something I really want, frivolous or otherwise.

I think 2009 will be a lost year; I don't anticipate much real recovery until after the first quarter of 2010. If any of these economic plans are going to work, it's going to take quite a while to trickle up or down and show any positive results. In the meantime, those without work can't spend, can't keep up even with restructured mortgages, can't get credit. The downward spiral perpetuates itself as it stands now. Until the bleeding of jobs stops, none of this is going to work.

    Bookmark   January 29, 2009 at 10:16PM
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Nope, no effect. I retired in 2006 because salaries for Exec Assts had plunged to the point where it made absolutely no sense for me to work 40 hours with a 1-hr daily commute for a net of $1500/mo after expenses. My MIL had moved in with us and we were dubious about the idea of leaving her alone - and it quickly became clear to us that she isn't capable of being left alone any longer, so that was another incentive to stay home.

We've cut back a little, but you'd have a hard time noticing it. Just bought a new Cuisinart convection toaster oven because it was a good sale on and I loathe our current deLonghi. Have a carpenter replacing our back porch landing and stairs for a small $2K job. Putting in a gray water system to deal with the specter of a third year of drought with mandatory water rationing, another $3-4K for that. Always keep both cars well maintained, every three months we take 'em in.

I am putting off the Lacanche Cormatin range I was lusting over, though! I was going to use a modest IRA account whose balance has dropped 30%. I figured that since my one real reservation about the Lacanche is that I haven't seen one in person to check out the size of its oven, I'd wait until we make another trip up to the PNW, probably in early 2010, to visit Art Culinaire with my tape measure in hand. Replacing our range is one of those domino affairs where I will have to replace a couple of other things at the same time, so the total cost for my pretty new toy would be around $20K. We have the money, but there are some other home maintenance biggies coming up that we'd feel better knowing we took care of those first, then can spend on the huge extra of a new range (when our old one works perfectly well, knock on wood).

    Bookmark   January 29, 2009 at 10:23PM
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DH's father, who resides with us, lost his health insurance coverage as a GM white-collar retiree. DS-in-L spent weeks deciding what new policy to get him (he is blind).

DH was offered and took an early retirement buy-out. He gets about the same income he would have with unemployment payments - about a quarter to a third of his old income. He applies for anything that looks like he could be considered for, has had two interviews. Next month we may need to dive into our savings.

Then there is the house we moved out of in November 2005. We still own it. The nurse who is living there in a rent-to-own situation recently had her pay cut. It looks like the credit crisis will keep her from getting a mortgage and fulfilling the terms of the agreement, but she says that she wants to continue renting. At a lower rental payment.

I am a contractual employee at the Community Mental Health office. My coworkers are voting next week to take decreases in their benefits and to accept 6 payless days next year. The job I am now doing was previously done by an employee, and if things were going better, the position would be posted and I would have a chance to get it. Then I would have benefiits, too. It is not going to be posted anytime soon, though. In a way, that is good. I can continue to work the job, no chance of losing it. But I will continue to have no retirement plan, no disability, no sick days and no unemployment insurance.

Our unemployment rate here is over 10%, but the count does not include people like DH, a 50-ish guy who needs to work and who cannot afford to live on his "retirement" package. None of the 5000 who bailed out of a sinking Big Three company with him - with a threat that this may be the only buy-out package they are ever offered - are counted. Neither are people who ran out of benefits, who took penny-ante jobs to have something to do, who got discouraged and gave up, or who are returning veterans.

The Regan Administration made big changes in how the unemployment numbers were counted back in the 1980s, so remember that when you compare today's numbers to pre 1980 numbers. A whole lot of people have not been counted since the 1980s.

    Bookmark   January 29, 2009 at 10:37PM
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tishtoshnm Zone 6/NM

duluth, you are right and I think it is very important when looking at costs that there are many places where hours are being cut so while they at least have a job and that is indeed significant, it may not be enough.

I also have to say too that this area so far there is no sign of deflation with the possible exception of housing. I have noticed that Wal-Mart's prices are going up and the cost of a hair cut went up recently too.

    Bookmark   January 29, 2009 at 11:26PM
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Obama is displeased ...

... the financial big shots have just been granted 18B bonuses for this year.

Their treasuries should have to pay that and more back to the Treasury!!!

I'm mad ... disgusted ...

... and I'm not a U.S. taxpayer!!!

Those guys live on a different planet.

I'm retired, have all that I need, as have many seniors at 80 (half a dozen of my family are helping me celebrate my 80th last night and today).

As one cousin said a few months ago on our return trip from another cousin's funeral, we need to cut down, to save our offspring the hassle of clearing our goods after our departure.

It seems to me that major inflation is down the pike - and not too far down it.

Huge gov't. debt, resulting from earlier borrowing.

Huge gov't. deficit due to spending far more now than income to cover.

Printing money, hand over fist ... when I came down from Canada, exchanged something under US$1.000. ... not a single bill was old, and many were carrying sequential serial numbers. Not one old bill in the lot!

Deliver me from putting my money into a bank to earn 2% or so.

Stocks are on sale, and, though they may be on fire sale later, when recovery appears, having bought them from time to time over the next few months (years?) will produce a better result, in the long run, than holding dollars guaranteed not to have their numbers shrink ... but with a parallel guarantee that they can't grow in number, either (apart from the rent). But each dollar will buy a lot less than when the deal was struck.

As if that's not enough, private debt is rising, as well.

And many, having received no wage increases recently, but finding prices going up, are borrowing against the value in their homes in order to preserve their former lifestyle.

But fewer have pensions ... and the intact ones are less lucrative.

What do these guys plan to do, a few months or years after retirement, when the money runs out ...

... run a car into an bridge abutment? Put a bullet into the brain?

Not a good scenario, any way you choose to cut it.

In my opinion - I sincerely hope that I'm wrong: I hope that some of you can show me in what way.

ole joyful

    Bookmark   January 30, 2009 at 5:04AM
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"I also have to say too that this area so far there is no sign of deflation with the possible exception of housing"

How about the biggest sign of deflation--OIL...

    Bookmark   January 30, 2009 at 6:57AM
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Our housing was about the last in the county to do a down turn and not a bad one. Our local paper said it came back up in Dec. That and retail sales were down at Christmas are the only changes in our local economy that our paper reported.

    Bookmark   January 30, 2009 at 10:15AM
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Yep, I'm officially affected. I'm self-employed and do contract work for Ford dealerships all over the country. I'm predicting my income will go down 30% to 50%. DH and I decided that if it hits 50%, we will put the house on the market. We built last year so hopefully it won't actually sell before the 2 year mark.

In the mean time the belt is tight, very-very tight.

    Bookmark   January 30, 2009 at 10:38AM
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Chemocurl zn5b/6a Indiana

Have you personally been affected by the economic downturn? Or just pulling in your expenses because you "fear" the unknown?

No, and No.

BF gets up each morning and watches all the gloom and doom on the TV. After work he tunes in to see what the market did that day and listens to more gloom and doom. Then he has often called and related the gloom and doom to me. He finally figured out that I don't care to hear it, and he even remarked that he thought it might be stressing him out and raising his blood pressure.

He is working, and in very secure shape financially, having always lived well below his means. Hopefully he will either quit stressing over something beyond his control, or just turn it off and save his health...sigh.


    Bookmark   January 30, 2009 at 10:47AM
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Nothing has really changed for us.

I retired after 33 years in the classroom so I receive my monthly retirement check. Goes straight to the bank. My wife continues to work.

We were never extravagant spenders so we didn't have to cut back. We cut back all along. The bills get paid on time, including the one credit card we use.

Our retirement accounts took a big hit but we don't need them right now. We can wait for things to improve.

Purchased a "new" - read pre-owned, vehicle is September and paid cash. We have no car loans.

Refinancing the house next week. No problem getting qualified/ approved. Going from 6% to 4.25% with no points.

In terms of the economy in general, we are not going to spend our way out of this mess as some beleive. Spending beyond our means got us into this mess to start. The stimulus package being debated seems more like a massive spending bill with little going to the average John Q. Public. Inflation will be here soon and make things worse.

Hopefully, I and the wife will continue to keep our heads above water.

Enjoy the journey.
eal51 in western CT

    Bookmark   January 30, 2009 at 11:15AM
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Definitely yes. We owned a fixer-upper home, which we were remodeling as we could afford to. In-Laws then offered us the family home for a deal which we just couldn't pass up. Sounded wonderful! My husbands job and my home business were going well so we quickly finished up the old house - using charge cards - thinking we'd pay them off the second that the old house sold. Then the housing market took a dive... We ended up selling the house for about $50,000 less than we had anticipated, leaving us bills that we hadn't anticipated, but could handle. Then I got sick.. went from doctor to doctor before being diagnosed with a benign brain tumor that's inoperable. Vision problems, seizures, and major fatigue among other symptoms set in so I've been unable to work since last Oct. Hubby's job was still going well and seemed stable so we were squeaking by okay. Then a couple of days before Christmas we got the news that the company my husband works for filed chapter 11... His paycheck has been cut in 1/2. By company policy he can't work for another company while still employed by them - and we HAVE to keep his medical insurance. Medical bills are rolling in big time - I've been going for radiation five days a week - and his job situation is looking bleaker. He'll be talking to his boss in the next day or two to find out if he can take a part time job elsewhere without being fired. I should be back to work at least part time in the next month or so hopefully but with the medical bills still to come keeping our heads above water is going to be tricky to say the least.

    Bookmark   January 30, 2009 at 12:03PM
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terrie2, i know a bit about "no compete" clauses ,which is what your husband apparently has with his present job,and under the circumstances of chapter 11 AND cutting his pay, there is NO way it could be enforced,i'd consult an attorney first,but i wouldn't tell your husband's employer about any PT job

    Bookmark   January 30, 2009 at 1:25PM
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Starting next week, the university where I work will start furloughing its employees. So, yeah I'm affected. The university tried to be income-sensitive so there is a sliding scale of furloughs - people earning less than a threshold are not furloughed at all while the top earners are furloughed for 5 days. I'm furloughed for 4 days. This means every pay period, I work 9 1/2 days instead of 10 full days for the next four months. It's not a huge amount of money but it does affect the bottom line as well as some retirement contributions. Also, we've been told already that there will be no COLA increase this year; in essence, my pay has been cut. So, I've cut back a bit on my savings rate (putting less away every pay period).

But I'd rather be furloughed and take a pay cut than be laid-off - which is what happened in the public school system where I worked in 1992. That was horrible. Then, we were warned about the possibility in December 1991 or January 1992. Then THE list came out in April - people were told then whether or not their position would be cut in the new fiscal year starting July 1. Ugh.

Luckily, DH has a very secure job in the federal government and I currently work part-time. In theory, I could increase my hours to full-time and earn more but I'd rather have the time than the money. I'm using my furlough time to spend more time with my mother.

    Bookmark   January 30, 2009 at 8:22PM
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There is talk in our area of give-backs by the teachers unions. Area mayors & selectmen are cutting town/ city budgets with many asking for zero percent increase. They also anticipate and sizable reduction in state aid to the local communities. That's not going to help either.

Since I still have contacts with teachers, including DW, it is going to be ugly. The unions, as of now, are not very receptive to give backs. Based on past histories, the towns/ cities do not recognize their sacrifices and do not restore anything when things get better. So I can understand the hesitation.

I would anticipate as we approach the spring, there are going to be many layoffs in the area public schools. You will also see and increase in the number of school systems that institute "pay to play" for athletics and other extra-curricular activities. It is not going to be a pretty picture at all.

I also think many area budgets that go to the vote will fail if there is any increase in spending at all.

And on a personal note, we just received our re-evaluation on our house. That usually means the property taxes will go up.

Enjoy the journey.
eal51 in western CT

    Bookmark   January 31, 2009 at 1:38PM
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It took 4 tries to get our town budget passed this year. Going to vote on the first Tuesday of the month was getting to be habitual. We finally passed a budget with only a .03% increase...basically the same. We also were reassessed this year. Our assessment nearly doubled but the mil rate dropped enough that the taxes only went up a couple hundred bucks.

Example of how nitpicky our budget is this year...the elementary school had to dig up an old heating oil tank. It left the grass in a mess & now the area holds water & is a mudhole most of the time. There was approximately $12K in the budget for grading, fill, & re-landscaping. Even with 4 didn't clear so the kids will have the mudhole another a year, at least. :)


    Bookmark   January 31, 2009 at 3:29PM
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We are in Michigan. Fortunately, my family is still doing well. We have made changes in the way we operate though. My job is stable--I'm a teacher with tenure in a large urban district--even if there are layoffs-I'm still OK. DH works for a bank as a commercial loan officer--bad time to be in that business! His job is very stressful right now, but there are no signs of him losing his job.
We have changed our lifestyle, spending cash only and working hard to pay off credit cards, cars, etc . . . (3 years to all paid off except mortgage)
We are also stocking up on some food incase Dh were to lose job. See my post on stocking up for emergencies.

    Bookmark   January 31, 2009 at 8:42PM
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Have you personally been affected by the economic downturn? Or just pulling in your expenses because you "fear" the unknown?

Personally? Some. My 401(k) and IRA are down about 30-35%. They've told us at work that there will be no merit increases/COLAs this year. There have been layoffs, there will be more, business at the company stinks and won't recover until everyone else does, but my area seems pretty safe. For now. Makes longer-term planning more interesting...

Since, like most posters here, I was never living on the edge of solvency, I'm not laying awake nights worrying what I'll ever do if I don't get my next paycheck. But I've cut back on larger discretionary expenses: eating out, tickets to sports and entertainment events, new furniture, some long-planned landscaping, etc. Better to have the cushion and not need it.

I have taken advantage of the plunge in housing prices (I've probably lost all the equity I built in my house over the last 5-6 years) and the number of foreclosures in my area by buying a foreclosure which I'm fixing up and will rent to a retired relative. I'm in the "money pit" stage with it at the moment, but the price was so right that I'm not even much worried about carrying that mortgage if I had to. And, who knows? It could be a valuable source of income if the worst happens. :-p

I think it's going to take a couple of years to fix the immediate issues with credit and corporate profits. But I think it's going to take many years for people to rebuild their confidence in our financial institutions; the agencies which should have been monitoring our financial institutions; and the whole concept of pay-for-performance, which has become pretty much a mockery in corporate America. I think folks will be much less willing to accept at face value anything anyone has to say. That's a damaging loss on which no one will be able to put a dollar cost.

    Bookmark   February 1, 2009 at 7:45PM
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My situation is similar to Steve's. Our 401k's are down. At almost 40, I'm worried about rebuilding before retirement.

There is a wage freeze at DH's company & at mine. DH's job is very secure. While business is down some, there have been only a couple of layoffs. DH tells me that was more of a "cleaning house" issue & those employees were going to be let go anyway. The company is very loyal to employees, especially those who have been loyal to them, like DH, who is a long-time employee. Things aren't so great at my company. There have been a lot of layoffs. They are asking me to train another employee (lower-paid than me) to do part of my job, saying that I don't have enough time to spend in the areas where they really need me. While it's true that I'm carrying a heavy load, I'm not sure that they aren't going to have me train this person & then outsource the rest of my job. I've started looking for something else, but job postings are pretty scarce here. I'm turning more to networking now & hoping that will help me find something. It's scary going to work every day & wondering if the company will be okay or if you'll be laid off.

We have several months of living expenses set aside. We've cut back on discretionary spending like eating out. We've postponed a planned remodel to our porch & buying some furniture for our office. We were planning a vacation for our anniversary (our first in several years), but we were planning to save for it out of my paycheck. If I don't have one, then we'll postpone that as well. Like Steve, I think it's better to have the cushion & not need it.

Housing prices around here have actually held up pretty well. We refinanced last year & will consider it again depending on the interest rate & the actual appraisal.

    Bookmark   February 1, 2009 at 10:21PM
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A little bit of both. DH was fired first of Dec but thankfully I make a good income, so we just tightened the belt, i.e. no dinners out for awhile and watching other unnecessary spending. 401K did take about a 9% hit, which I guess isn't too bad considering. DH has since landed a temp job, but the pay is not good and many companies in our area (Seattle) are laying off. Best friend in CA who works for the state is now facing a 10% cut for the next 18 months due to their budget. Just talked to a friend in NC who says unemployment rates in his general area are now at 15%.

    Bookmark   February 2, 2009 at 1:07AM
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Yes and no.

Yes, because my 401K and my husband's Thrift Savings Plan took a hit.

No, because we are still gainfully employed;our houses and cars are paid for; we have no credit card debt; we live within our means.

    Bookmark   February 2, 2009 at 10:40AM
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Well, My DW & I just returned from a 30-day cruise (to celebrate our 30th anniversary) to Tahiti, Bora Bora, and Hawaii, so I guess the answer would be no. In fact, after watching our investments evaporate over the past year, I think we are more inclined to spend even more now than before. Rather than throw more money into the stock market and watch its value slowly diminish, we plan to spend the money on ourselves and enjoy it while it (and our good health) lasts.

    Bookmark   February 7, 2009 at 8:48AM
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bethesda, sounds like a terrific trip!!!! I've always believed in enjoying your $$$ now, with an eye on the future..Who knows what the future will bring and whether or not you'll be healthy enough to enjoy your $$$,or the $$$ will actually be there when needed!!! I have had friends who have scrimped and saved with retirement as their sole focus..Sure they enjoyed some fruits of their labor, but ALWAYS worried about affording retirement..

These friends have net assets over 2.5 mil,or should i say HAD,until the current downturn in the markets(housing and stock) wiped out a significant portion..Though they still have assets most can only dream about,they passed up many opportunities to enjoy the $$ that is now gone forever.

    Bookmark   February 7, 2009 at 8:57AM
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duluth, I agree with your comments. Want to add that in addition to the numbers of uncounted unemployed or under-employed, is the influx of illegal aliens and green cards that take jobs away from citizens. While the illegals take lower paying jobs, they also are taking jobs that would have paid more to Americans such as in the building industry. There are numerous green card-ers that government doesn't even know where they are. 150,000 is the number approved for this year!

    Bookmark   February 7, 2009 at 12:06PM
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We're at our little Maui condo now. Tourism is down in Hawaii, even now, which is THE snowbird season. Our condo is booked up to mid-May; after that the calendar is a desert. Same with other owners' calendars. Still, we decided two years ago NOT to sell, so will ride it out. Hope recovery happens by 2010. Up to now, this has been an investment we can also enjoy.

We're retired. We collect Soc. Sec. and DH's company is still able to fund his pension. He's glad he's not being asked to move to India or China as his old firm is now asking of its employees. (What a deal: Move abroad and you'll still be our employee, although paid at the foreign country's rates.)

Our portfolio has been very conservative for years -- we made it even more so two years ago -- so that hit hasn't been AS bad as it might have been. Ridght now it's hard to find a place to PUT money for conservative investment. An inflation that raised CD rates wouldn't be all negative news in our situation: We have no debt and no need to borrow. Income still exceeds expenses. We've never been big 'acquirerers'. Nice houses, yes. Jaguars, yes. We've traveled; been there, done that. Now quite content with what we have. No help from us for the topheavy consumer dependent American economy.

DS's field is Health and that's continuing to grow. DIL's school is closing; she will have to re-interview, etc. if she wants to continue at Chicago Public Schools. (There is a huge oversupply of teachers or wanna-be teachers now, but she is experienced and her field is math.) Their house is all but paid for; small mortgage at low rate w/about 10 years to go on it.

    Bookmark   February 7, 2009 at 12:10PM
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Want to add that in addition to the numbers of uncounted unemployed or under-employed, is the influx of illegal aliens and green cards that take jobs away from citizens. While the illegals take lower paying jobs, they also are taking jobs that would have paid more to Americans such as in the building industry. There are numerous green card-ers that government doesn't even know where they are. 150,000 is the number approved for this year!

Wow. Quite the xenophobic response. I suppose you want all the immigrants, even the legal ones and the "green card-ers" (these are the people who are legal permanent residents, the necessary stage before becoming a US citizen) to leave.

    Bookmark   February 7, 2009 at 1:17PM
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"Ironically if the money had been given to the people, the people would be spending, paying off credit and other debt - increases credit available for housing, cars, etc., requiring the need for more hiring to build them, and would be an influx in taxes paid and would trickle up."

Wow!!!I thought this mess was (mostly) originated from people spending the money they did not have, owing too much on their credit cards, and getting greedy by leveraging too much on their mortgages. You are suggesting to give people more money!?

    Bookmark   February 8, 2009 at 9:41AM
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And weren't people 'given money' last year? 30% was spent. That's about as useful a tactic as doing nothing.

    Bookmark   February 9, 2009 at 5:32AM
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jy md - you have attacked me before - Fine if you disagree with me but do not put words in my mouth. And don't assume that I "mean" something I did not say. Yes, I lumped green cards and work visas together. That was a mistake on my part. And I stated ILLEGAL aliens, who are draining our country not only of jobs, but of medical benefits, educational benefits, and other spending that would otherwise go to our citizens in need.

azmom and kec01 - I did not say to give people money. I said if people had been given the money that was given to the fat cats who mismanaged their companies - that is not 300, 500, 1000 dollars that is trillions of dollars - possibly the return would have been different.

Yes people spent money they didn't have - that is not the same as people spending money they do have.

Please don't read more into my comments than are stated. I did not suggest that any money be given to ANYONE. I was just looking at it from a different angle.

    Bookmark   February 9, 2009 at 11:21AM
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The presence of millions of illegal immigrants are having a direct effect on our economy and on our job situation.

They are having a direct effect on our schools, our welfare systems, our healthcare system.

The fact is, as well, that our government allowing companies to bring in workers 'legally' on visas, etc., when they are displacing American workers is also having an effect.

Someone earlier mentioned a family member who was a teacher and the downturn affecting them. I read about a school district, about 5 years ago, that was solving it's financial problems by importing teachers from India. They were forcing the retirement of teachers who were eligible and giving early retirement to those eligible and replacing them with Indian teachers. Anyone desiring to bring in foreign workers should absolutely have to prove they cannot find American workers to fill the jobs. If they are caught lying about this, there should be serious consequences.

Think about the RN program that is bringing in RN's to this country. A shortage of RN's has been reported for quite some years now - we could have trained our own in that length of time - if the desire was simply to have workers - and not to have 'cheap' workers.

'Xenophoboic'? Not at all - just plain old common sense.

Yes, part of our problem was, and is, that people overspend and buy things they don't need, with money they don't have - that's on a personal level. That is not the whole story of the collapse - it had to do with mismanagement and some downright skullduggery on the part of the very CEO's, and others, our government has seen fit to provide with nice severance packages - from our great grandchildren's future earnings.

How would it have been worse to let the people spend this money - spread over the entire country than to concentrate it in a few hundred already super wealthy people of questionable integrity? And prop up companies that have shown they aren't operating in a responsible manner?

Personally, I don't think there should have been a bailout - I think we should have let the economy take the hit, and begin to build on solid ground, learning from our mistakes.

    Bookmark   February 9, 2009 at 1:49PM
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Not against you personally, lady texan, but I don't want to be a part of a country that continues to exist to protect Republican Texas interests any longer. I'd rather be a part of a country that is focused on getting out of a mess that both political parties got us into. And that country needs to be one that realizes that foreign countries need us and we need them. We as individuals need business and business needs us.

And I'm saying this an an unemployed American citizen who was laid off a few months ago after having worked for 30 years.

    Bookmark   February 9, 2009 at 2:43PM
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No offense as I, too, think government has got to quit protecting business. My confusions comes with the idea that it is only 'Texas Republicans' that are being protected.

Both so called parties have worked in tandem for many years to protect, aid and abet big business in it's quest for power and money. These people have no allegiance to any party, idealogy or country - only money.

Yes, we need other countries - to what degree and how is what is in question. It should be pretty apparent that we do not need to continue to deal with them in the ways we have been dealing with them.

We need business - but not the exploitative business that we have come to know in the last 3 decades.

    Bookmark   February 9, 2009 at 5:32PM
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