Whether we make minimum wage or a six-figure salary, we’ve all felt the effects of the economic recession. Unemployment rates have soared to record levels and retirement plans have taken major hits.  Families who had been financially stable and who felt confident about their future suddenly find themselves unable to pay their mortgage.  Even for many of us who are still employed, luxury purchases and vacations are a thing of the past. 

How did this happen?  Could we have seen it coming?  The experts are still debating these questions.  But certainly on a personal level, no matter how carefully we had budgeted and planned, our sense of security has been shaken. 

The good news is that even in these precarious economic times, there are some ways you can protect yourself and your family.  If you are struggling financially, taking some of these steps really can help.

• Track your spending.  Write down every purchase you make, no matter how small, for one month.  It’s so easy to think that the little purchases we make every day don’t really amount to much.  But once you start tracking what you spend and how you spend it, you may be surprised how things add up.  Think of some ways to stretch your funds.  Rather than stopping by Starbucks every morning, you could brew the same coffee at home and maybe treat yourself to coffee out once a week.  How much money could you save each month if you packed your own lunch most work days?

• Create a budget.  Once you’ve figured out where your money is going, it’s time to distinguish between your essential and discretionary spending.  Determine which expenditures are discretionary, and trim these non-essentials.  As tempting as it may be to treat yourself to a new outfit or an expensive dinner, when times are tough financially, these are the first things to cut out of your budget.  Now, write down the amounts you have to spend each month on basics such as food, rent or mortgage, transportation, and utilities.  Look for ways to cut back on your essential spending, such as clipping coupons or turning down the thermostat a few degrees.  Sometimes even small changes can make a significant difference. 

• Pay yourself first.  Although it can be difficult enough to meet expenses and pay off your debts, set aside a percentage of your monthly income and put it into savings.  It will be difficult to achieve financial independence unless you save regularly and over a long period of time.  There are many retirement programs to choose from that can help you save a portion of your earnings for your future needs.  For example, a Roth IRA allows you to set aside part of your salary to be used tax-free, once you are of retirement age.  Although paying off your immediate debts is important, it’s equally important to start retirement planning early, or else you may face even more financial difficulties in your later years.

• Pay with cash as much as possible.  You’re much less likely to make frivolous or unnecessary purchases if you use cash to pay for them.  Resist the temptation to use your credit card unless you absolutely need to.  If you are struggling financially, the fewer credit cards you have, the better. Ideally, you should keep only one or two cards, and use them only for emergencies.  Choose the card with the lowest total annual costs, which includes monthly interest rates and annual fees, if any.

At Jewish Community Services, we are seeing people from all walks of life who have been affected by the recession and who need help getting back on their feet.  Sometimes a brief consultation or short-term counseling is enough.  If you feel you could use some guidance and support in managing your finances, contact JCS at 410-466-9200, or speak to a licensed financial advisor.  Not only can you get help in weathering this recession, but you can acquire skills and habits that will stand you in good stead financially for years to come.

By Paige Lee, Service Coordinator, Jewish Community Services, Baltimore, MD

To learn more about how JCS can help you solve life’s puzzles, visit http://www.jcsbaltimore.org or call 410-466-9200.  Jewish Community Services is an agency of THE ASSOCIATED: Jewish Community Federation of Baltimore.

My friend emailed me this article, thank you keeping it simple. I am terrible with money and in these economic times, simple mindfulness techinque really come in handy.

I love how simple and succinct this article is. I must pay myself instead of spending rent on a dress or heels. This is a great start because in 3 years I want to be married and financial stable. GREAT WAY TO START hope to see more from this Author.

Dear Author,
Last night I was reading Woody Allen’s comedic gold, ‘Side Effects’ which I borrowed from the library.  Boy, oh boy does that man make me laugh my tuckus off. Suddenly I started to think about how much money I save by going to the library. I can get DVDs, CDs, and even VHS tapes, of everything from Streisand to Survivor stories ( and I am talking about the Larry David ‘Suvivior’ not that Island of sin.)
I find making your own kosher food at home and shopping at COSTCO really saves the bucks.  Having my wife make the clothes by hand helps, and it keeps her busy and happy to create looks for the brood. I also hold Sabbath in High Regard, that really helps cut costs.  Not using my car on weekends and/or driving a moped to work helps me save time, money and the aggravation of lending anyone a ride. Futhermore, I declare my house a shrine to our community, so I don’t have to pay into the ridiculous tax system in this country.
Times are tough, and this article shows a real interest in helping women manage money. I give my wife an allowance to run the house and take care of herself, with rising cost of goods due to inflation and greed, and cost of doing business, my wife can no longer afford buying Prada for herself.  She is really feeling the pinch.
G*d I love my wife, and I really hope we can overcome this depression. My kids are are eating Pancakes for dinner, twice a week now.
Thank you for writing this, I will share it with my wife, in the morning. Maybe, she will listen to your sanity.

PS
My apologies for writing this twice, webmaster please delete prior post, as I did not proof read. Shalom

Dear Author,
Last night I was reading Woody Allen’s comedic good, ‘Side Effects’ that I got from the library, boy does that man make me laugh my tuckus off. Suddenly I started to think about how much money I save by going to the library. I can get dvds, music, and even vhs tapes, of everything from Streisand to Survivor stories ( and I am talking Larry David Suvivior not that Island stuff.
I find making your own kosher food, and having my wife make the clothes by hand helps, and it keeps her busy and happy to create looks. I also hold sabbath in high regard, that really helps cut costs.  Not using my car or driving a moped to work helps me save time, money and the aggravation of lending anyone a ride. Futhermore, I declare my house a shrine, so I don’t have to pay into the ridiculous tax system in this country. Times are tough, and this article shows a real interest in helping women manage money. I give my wife an allowance to run the house and take care of herself, with rising cost of goods due to inflation and greed, and cost of doing business, my wife can no longer afford buying Prada for herself.  She is really feeling the pinch. God I love my wife, and I really hope we can overcome this depression. My kids are are eating Pancakes for dinner, twice a week now.  Thank you for writing this, I will share it with my wife, in the morning.

Paige,

This article is as good as any I have seen in a financial magazine.

You blog is professional, informative, to the point and filled with practical information.

I am sure you will receive many compliments on the quality of your work.

You have an amazing grasp on common financial problems affecting many Americans today.  I will keep you in mind when Mom or I have a financial question.

Love, Dad