Although the news of the economy might be scaring you, you can consciously decide to live a policy of profitability and not survivability. It’s just a matter of knowing when to hold on to your money and when to move it around.
Don’t cash in your 401K to get you through this tough time.
It’s better not to even look at your 401k right now. Stay steady and keep investing. A panic decision to cash out can result in tax and early withdrawal penalties that can come back to haunt you.
Do hang on to customers at all costs.
The price of generating new business can be costly and is not always guaranteed. If a customer is having trouble affording your product or service, try working with them to make it affordable. This will help build customer loyalty and will certainly pay off in the long run.
Don’t buy junk you really don’t need.
Retail therapy is not a medical treatment. Notice how houses that are at least 30 years old have small closets and even smaller garages? Now we have these colossal closets, attics, three-car garages and we have created a new industry that has exploded over the past couple of decades’ self-storage. This is all so we can store all the needless crud we buy. Stop trying to medicate your woes by buying more stuff.
Do ask yourself: Do I need it or just want it?
It’s good to separate need from want. You will be surprised how few fit into need and how many are just wants.
Do grace your customers with your presence.
A recession is no time to hide. Be as visible as possible among your customer base. It is more difficult for customers to say no during a face-to-face meeting than in an e-mail or during a phone conversation.
Don’t drink from only one river.
We live in the era of entrepreneurship. Regardless of the job or business you have, everyone should be involved in generating multiple streams of income from a variety of enterprises. The opportunities are too abundant and it is too easy not to. Now you will never go thirsty if one of your rivers gets dammed up.
Don’t let your house get bigger than your wallet.
Mortgage companies use a calculation to determine if you can afford the mortgage payment; it is called Debt-to-Income ratio (DTI). This is one of the numbers that became too flexible over the past few years, allowing people to get into houses they couldn’t really afford. This is also their standard and doesn’t have to be yours. Just like you should eat better than the FDA recommended daily allowance, you should also have more prudence in your financial choices.
Do have a buy-and-hold strategy when it comes to real estate investments.
Wealth creation through strategic acquisitions held for long-term income is the smartest plan. If you have some cash to invest, the drop in home values could be your gain.
Do invest in you.
The most important investment you can make in securing your long-term financial viability is the investment in YOU and your personal development. In these fast-moving and ever changing times the degree on your wall is marginalized within a few years. After graduation day, learning should not only continue, but accelerate. As Jim Rohn says, “Formal education will make you a living; self-education will make you a fortune.” It will be your continual growth and development that will keep your money tree ever fruitful.