Lessons Learned from the Economic Meltdown – 5 Personal Stories
This post is result of my curiosity about what is happening as a result of the economic meltdown. Yes, we hear a lot about it on the news, but that’s all about big banks, auto companies, and bail out package.
But what I was curious about was the stories the don’t make it onto CNN; what effect is the credit meltdown having on normal people.
So I asked 5 strangers to write down what they had learned as a result of the tough economic conditions. Like I was, I think you’ll find the stories very engaging, and you’ll see how powerful of force money is to shape people’s lives.
Story #1. Money is No Object
Money is no object. Until you realize you have none. I’ve seen this coming for a long time and I’m no stranger to adversity. But I never thought it was going to hit me all at once. I lost my job last month. There’s nothing like instant poverty to give you an unpleasant wake-up call and teach you a few things about how far you can stretch your budget and your imagination.
For instance; I learned that the bills and junk mail I shred make an excellent subsitute for kitty litter if you run out and can’t afford more. Who knew?
I also realized that once you get used to the after taste, the “government cheese” isn’t so bad after all. Besides, if you get really hard up, you can heat it and use it for caulking. Who knew?
Did you know that Top Ramen is only .12 cents a package in fine grocery stores nationwide? I didn’t, until it became a main staple in my household. Apparently people have been eating this stuff for years. Who knew?
I found out that you can get a $3.00 haircut by a student at the local beauty college. I also learned that you need to buy a $7.00 hat to cover up the apocalyptic catastrophe that once kept your head warm. That wasn’t totally cost effective after all.
I also learned that thrift stores sell used goods for twice what they are worth in their present condition; but half of what you’d pay for them new. Also, since everything you buy from a thrift store smells like grandpa Joe’s house, which hasn’t been cleaned properly since grandma passed away in 1972; Febreeze is a must-have. Or should I say; must-half.
I now know 27 different ways to prepare macaroni and cheese. I also found out quickly just how much weight you can gain on a constant diet of starchy foods. Thankfully, the thrift store also carries clothing. The eighties will be making a comeback in my wardrobe. Hello, acid washed denim!
In the end, the most important thing I’ve learned through all of this, is humility.
Stephanie, Kingman – USA
Story #2. Nevermind saving your finances, how do you save your marriage?
During the economic downturn, I was preparing myself for our own budget crisis, but not prepared for the marriage crisis that would ensue. Previously, I vowed that adultery or abandonment would be the only cause for divorce, but as I later learned – most sources say that finances are the #1 reason for divorce. Even when the words, “I want a divorce” were first uttered, my first thought was preparing myself financially, rather than involving myself emotionally. How did this happen?
I thought it sad to know that before adultery, before abuse, before addiction and before the loss of intimacy, most persons would divorce over finances. My husband and I thought that we loved each other very much. However, the technicalities of our budget and the stresses of securing our finances took precedence over emotional needs. How could we focus on saving our love when we needed to save the home that physically housed our love?
Our love wasn’t expressed with lavish material gifts or expensive evenings out. Yet somehow, it found it’s conditionality with the bad news that my company was no longer offsetting our insurance premium and when my husband’s hours were reduced to a part-time position. It’s difficult for an “I love you” to cure the frustration of having to look for a second job or when you drop $500 for just one doctor visit, one lab test and one bottle of medication.
Finding the strength to stay true to your vow “For Richer or Poorer” can’t be taken on by one person alone. If we weren’t both willing to see this financial uncertainty to the end, then the life we had together wouldn’t survive. However, we both know deep down, that there’s no price that can be placed on ending our love.
Althea Deveaux, Los Angeles – USA
Story #3. What really matters
During this economic downturn, I’ve learned what’s really important in my life and that isn’t the possessions I own but the people who care about me. Thanks to this economy, I’ve lost enough freelance gigs that I barely have money to eat. Things like Sunday brunch, going out for drinks or even seeing a movie are luxuries that I can’t afford right now. The people who were around me because they wanted to “do things” seem to have vanished. My true friends have stayed and we’ve learned together how to do things for free or on the cheap.
Speaking of my possessions, I’ve learned in this economy how to shop at thrift stores and E-bay. Do I really need new winter boots that will get scruffy after a walk in the snow? Do I really need to buy the latest gadgets and other fun devices? How many coats do I need? I now make a list of items I plan on purchasing, so I can decide if I truly need them or if I am just being greedy. Along those lines, I’ve been selling items on Amazon.com and E-bay. If I haven’t worn it in a year, the item is being sold. Also, once I read a book, I either pass it on or sell it. This has served to free me from my need for possessions, thus allowing me to focus on those who truly matter to me.
Michelle, New York – NY
Story #4. Credit is the devil
I have learned that we as an American nation should not be at all surprised that we are in this mess up to our necks. In recent years, we have redefined the “American Dream” as a method of living beyond our means.
The economic downturn is the result of one thing and one thing only: credit. Credit is the devil. Because of credit, people are granted false wealth and false security. Sure, in principle, it sounds like a bowl of ice cream. But when that sweetness melts away we are left with more than we can handle. I for one made this same mistake. Fresh out of high school I was offered a new credit card at every turn.
Now I am in so much debt I can’t see straight. I have learned that credit cards of any type are bad and if I can’t afford it with what is in my pocket then I don’t need it. I can only hope that every person adopts this mentality. If we continue to live beyond our means, we will only fall further into economic crisis.
I wish that I could wave a magic wand and eliminate all credit card companies in the blink of an eye.
Unfortunately, I would have more success discovering that Unicorns really do exist. Things will not get better until we wake up and realize that nothing comes without hard work and dedication. I don’t foresee that happening anytime in the foreseeable future.
bb, jasper – usa
Story #5. downturn vortex…
The recent unfolding of economic events in the past 1 and half years has left everyone crippled. The start of the housing crisis surely was gonna bring out the worse parts of economies, but the fall of giants like Lehman, Merill, AIG and others has shown to what extent many of these companies have invested in toxic assets just for expectancy of more gains.
I personally had invested heavily in these companies considering them to be world leaders and stable. But they have shown what kind of leaders they are and what precedent they have set for others.
In spite of facing heavy losses, one thing is clear, one’s portfolio always needs to be diversified, as in not only equity but bullion, bonds and FDs if you really want to stay afloat. I have known many friends who invested all their savings into markets and lost heavily.
Millionaires turned paupers by losing in oil slump. I personally have also decided to refrain from commodities for now when the financial downturn is taking its toll. Though I am feeling soon I will find the best of deals in real estate. One of my colleagues million dollar home sold for mere 3lac USD, Reason is he badly needed money and had no choice but to sell it.
If you’ve learned any life lessons as a result of this economic crisis, please leave a comment. I’d also like to thank the people who bravely stepped up to tell there stories for us all to learn from.
[this post was featured in the 195th Edition of the Carnival of Personal Finance at Stock Trading to Go]