Surviving Financial Meltdown

If you read the papers or watch the television, there is a lot of talk about the horrible state of the economy, but very little talk about surviving financial meltdown. It is as if the media thinks that a financial catastrophe is coming, but they have no idea what to do about it. Lots of mentions of coming foreclosures, bankruptcies, bailouts, inflation, etc. but the only thing that gets reported on about how to fix it is the government’s plans. Bailout this, stimulus that. It’s like they think we have amnesia and that we don’t remember that it has been tried before and it didn’t work – in fact, it made it worse.

So, what do we need to do to make surviving financial meltdown a possibility? I’ve got 3 keys that will help you and your family to get through just about any tough times. Now, many of these are a bit tough, but they are possible, and I think this is how God has called us to live as good stewards of what He has given us.

5 Keys To Surviving Financial Meltdown

1. Ignorance Is Not An Excuse

Make sure that you know what is going on in the financial world. Get a subscription to the Wall Street Journal and read it. Listen to the business news. Take a money management course that teaches you to make a budget and stick with it. It will be bit scary to read about all of the financial trouble going on in the world and how it may affect our economy here. But wouldn’t you rather know about it now and prepare for it rather than wait until it happens and try to react?

2. Have Lots of Money Available

You want to build six months worth of cash reserve in order to help you in surviving financial meltdown. Why six months worth? Because for any emergency, from losing your job to an economic crisis, six months is about how long it will take you to adjust how you live and make the necessary changes. You might need to sell your house (check out my post on pricing a house to sell), or your car to downsize your budget. One thing to note here is that you want your savings to be liquid, and you want it to be diversified. Cash, foreign currencies (to protect against the devaluation of the dollar), CDs, precious metals. And make sure that it is kept in safe and conservative hands (ask for references). You want it to be there when you need it!

3. Have Friends You Can Count On

Make sure that you have a network of friends and family that you can count on in tough times. And be prepared to be that friend to others. Good friends and family are more precious than anything that you can lose in a financial meltdown and it is important to remember that in good times and in bad. So make sure that you are always there to help your friends because you never know when you will need them to return the favor.

4. No More Debt

Get out of debt immediately. As it says in Proverbs 22:7, the rich rule over the poor and the borrower is the servant to the lender. Don’t put yourself in bondage. God wants you to be free, and He wants you to be free of the financial stress and troubles that debt can cause (debt related troubles are one of the leading causes of divorce). Start paying off your credit cards, your student loans, your car loans, and even your mortgage. Imagine the freedom of being debt free!

5. Make Money Several Different Ways

You want to make sure that your income is coming from different sources. In the Bible, Abraham, who was very wise and God blessed him with incredible wealth, had income from cattle, gold, and silver. Look for other sources of income to supplement your job. This is one of the best ways to position yourself so that you are ready for surviving financial meltdown and that you are ready for whatever economic curveballs come your way.

Pricing A House To Sell – The First Price Matters!

Every piece of property in America can be sold, but there is a catch. And that catch is a big one – price. And everyone knows that you have to set the price of a house right if you want to sell it, but what does it mean to price a house to sell? First, let’s talk about what it does not mean. Pricing a house to sell does not mean that you price it at what you paid for it (or what you owe on it). In a declining market like today’s this has no relevance to the current price of a house. Pricing a house to sell does not mean setting the price at what you think your house is worth. Unfortunately, especially in a falling market, what you think your property is worth doesn’t matter. What matters is what a buyer is willing to pay.

So, pricing a house to sell means setting the price at an amount that a buyer is willing to pay. Sounds simple enough, but it is one of the hardest things for property owners (and their agents) to do correctly. If you have been following the market recently, there is one trend that I’m sure that you have noticed. Sellers are pricing their houses too high. This is evidenced by the fact that houses are taking a very long time to sell, and that most sellers have to reduce their price several times before they sell. Let me tell you why you don’t want this to happen to you.

Pricing a House To Sell – First Price

The most important thing in pricing a house to sell is the first price, or the initial asking price. I’ll go into the reasons why below, but I can’t state this strongly enough – “Price your property right the first time!” If you aren’t willing to price your house at a price that a buyer is willing to pay, you probably shouldn’t be selling your house right now.

When you are pricing your house to sell, here are two things that you will want to keep in mind. First, be objective. Don’t think about all of the work that you have put into the house, or the memories that it encapsulates. Buyers don’t really care about those things. Second, you want to price it at or slightly below the demonstrated market value. Sure you might lose a little bit this way, but selling quickly is always better than the stress that comes from waiting for your house to sell as the market value continues to decrease.

3 Reasons Pricing a House To Sell Matters

1. Likely Buyers Won’t See The Home Buyers look at houses in their price range for obvious reasons. If you price too high, the most likely buyers for your house aren’t even going to see it. With pre-qualification in hand, buyers will only look at houses in their range, but if you are over, they won’t bother to look.
2. No Momentum A house is considered hot when it first hits the market. Agents want to be the first ones to show a new house to their clients in the hope that they will be the one to get the commission. But agents know what houses are worth, and if you have priced too high, they are not going to bother showing it to their clients.
3. More time equals less money. The longer your house is on the market, the less it will sell for. And in a declining market like today’s, this is even more apparent. As the prices continue to go down, your property continues to lose value, and the buyers are willing to pay less for it.

I hope that this post has helped you to see that your first price is very important, and that pricing a house to sell can make all the difference in how quickly you sell your home.