I ran the numbers...it's pretty scary.

[CoffeeCat]

With the economy sputtering--it's important to plan for a worst-case scenario--such
as long-term unemployment, loss of benefits or the closing of a family business. As many of us
know first hand--we've all ready had a worst-case scenario happen in our households.

A while back, I ran some numbers. I was trying to figure out how long we could survive
if my husband lost his job--since he is the major breadwinner. I happened to look up
my state's unemployment benefits, and I was shocked. The maximum benefit for a family
of four--is $1,692 per month. Considering that we would have no health benefits, and would
need to pay about $1,000 per month for COBRA--that would leave our family with $692 per month
to live on, plus savings.

Have you run your own numbers? As many of our DU friends are unemployed or losing businesses
and homes--I'm sure they can attest to the harsh reality of their own numbers.

It's unconscionable that our politicians have not moved to extend unemployment benefits to those
who are facing benefit expiration in about a week.

Please. Run your own household numbers, if you haven't all ready. It's important to understand
what would happen if you did lose an income...or two.

We don't need to wander around depressed and paranoid--but being prepared is important. Brush up
your resume now--instead of when you're in crisis mode. Take a community class to freshen up your
computer skills. Stockpile some non-perishables and other essentials (toothpaste, shampoo, toilet paper)
when you find great sales on these items. Plan a garden for this spring and summer, to cut
back on the grocery bill.

Shore up your savings. Even if you set aside an extra $20 per paycheck, those dollars accumulate and can give
you a critical cushion of one or two months--not to mention a small slice of comfort during a stressful time.
Have a garage sale this spring or Ebay/Craig's List some things that could help build your cash reserves.

There's no need to panic, but it is important to be prepared--and to face those numbers and plan accordingly.

[JDPriestly]

1. It's time to hunker down.

On top of all the other problems, we are likely to see some floods in some parts of the country this Spring. Lots of snow tends to bring floods. So if you live near a flood zone, be careful.

[CoffeeCat]

3. Yes, we are inches away from record-breaking snowfall...

The most snowfall EVER recorded in an Iowa winter was 72 inches. We are at about 50 inches now
this winter. It's totally crazy. The forecast for Sunday-Monday is another ten inches in our
area.

Local experts are predicting massive floods throughout the state, due to the snow-pack and
the cold temperatures. The snow is piling up everywhere and cannot melt. When the temps
do heat up for spring, it looks like all of this will be melting all at once.

We've had two "500 year floods" in this area, in the past 10 years. They're telling us
to brace for the possibility of another one.

[Luciferous]

2. My husband was laid off last year for 7 months and it just about

depleted our savings. We are just now getting our savings back to what it was before he was laid off, and just this week they started laying off workers again :eyes:

It's very important to be prepared. We would have been in serious trouble if we didn't have that savings.

[CoffeeCat]

5. When a layoff happens...

...and you see how important those savings are--it really makes you intensely save again, doesn't it?

My husband took a 30 percent paycut for six months last year. We didn't know if the company would go under
or if eventually my husband would be fired. It was difficult to save while dealing with the pay cut, but
we did--because times were so uncertain.

Now that the income has returned to normal, we are still saving and we've drastically reduced our spending.

Nothing like a little crisis to change everything, is there? Glad your husband is back on the job.

[Goldstein1984]

4. The process of getting prepared can serve another purpose

Getting prepared to live without income, or survive an economic collapse, means diverting money that might be spent on entertainment or other non-essentials to reserves rather than feeding the economy. In an economy based (before the recession) 70% of consumption, that sends a powerful message and errodes the status quo.

Preparing to survive the second dip, and boycotting the economic system taking us there, are basically the same thing.

[branders seine]

6. I was well-off (low six-figure income, fairly high net worth)

prior to an extended under- and unemployment run from 2002 until 2008.

At the outset, I thought my unemployment benefits (I got no extensions being so far ahead of the curve) and savings would last me up to a year if worse came to worst. Naturally, it was far worse than I expected, but because I adapted to living like a pauper and luckily had enough at the start of it all to provide permanent cheap housing for myself, they lasted four years. That left two years of desperate survival before blessed employment. Knock wood. Note that for six years, I basically spent zero money. No restaurants, no vacations, no movies, no "luxuries" at all. Just me, my dog, and books, piano, guitars and enough hit-and-miss gigs to pay for milk bones, strings and gas money. It was liberating!

It would be tough on kids though I imagine.

[CrispyQ]

8. "...enough hit-and-miss gigs to pay for milk bones, strings and gas money."

Well at least milk bones were top of the list! :D My dog gives you two furry paws up for that!

Years ago we considered purchasing a newer, bigger home. Instead, we opted to pay off the little house we're in. It was the best frickin' decision we made.

[JDPriestly]

17. CrispyQ, we made the same decision and are really glad we did.

I always dreamed of a nice home. As soon as I got a higher salary, housing prices skyrocketed. Soon after that, I lost my job. We have been living on a shoestring ever since. No restaurants, Netflix instead of movies, walks around our are instead of travel. Gardening and reading library books instead of cable. Simplicity can be wonderful. Who needs consumption.

You don't need new clothes much if you aren't working. And forget about pantyhose.

[CrispyQ]

24. I don't know which I hate more, pantyhose or heels!

I watch Property Virgins in HGTV & wonder at the young couples committing to mortgages of $2K & up. I figure they're either getting help from Mom & Dad or they've never experienced an unexpected event in their lives, like losing a job or an expensive illness.

There's a lot to be said for simplicity. Perhaps that's the silver lining in this economic storm cloud - that people will get back to the simple pleasures of life, instead of the barrage of electronic noise that pummels us now. Wow, I sound like an old fart! :D

:hi:

[tango-tee]

25. Similar here!

My husband is retired, and a few years ago I changed jobs, making quite a bit less than before.

We now live in a small apartment, since my husband's leg was amputated and I have RA. If one of us were to die, the other could still afford to pay the rent. No shoveling snow, our family doctor's office is in the building, pharmacy is across the courtyard, dentist's office is next door, grocery store is around the corner. I can wear jeans to work. We do not have a car, since our town has a really good public transportation system with trolleys, buses and subways.

Aside from these very fortunate coincidences, last time we went out for a restaurant dinner was a couple of years ago, before money became really tight. No more restaurant lunches for me, I've been brownbagging and using the microwave at work. We needed to cut all non-essential spending, but now that my paycheck has increased again we noticed that we have become so used to living frugally, that we still think twice about spending.

So some good has come of our enforced frugality. No more of the "Oh, that's cute, I think I'll buy it" for me.... Only to have it sitting in the back of the closet or collecting dust in the living room.

One thing we've tried to keep up, although in lower amounts, were donations to various good causes (Doctors without Borders, etc.).

[Lorien]

29. I've been in the very same situation

I had a six figure income and substantial savings in the 1990's. My unemployment/ under employment run has gone on from 2002 to now, but before that I lost my life savings to medical bills and surgeries that my insurance refused to cover. I have learned to live with only the bare essentials, and it is somehow liberating! I don't waste time or money shopping for anything that I don't really need. I don't worry about fashion trends, I've learned to be a good enough cook that I like what I make at home better than what I can get in most restaurants. I have books, kitties, friends and art to keep me occupied. I don't need more than that!

[DeschutesRiver]

36. I experienced some of that growing up back in the day

yes, today's kids might have a bit of a tough go at first. But there still are kids who live like this today, and probably end up more creative than those provided with their every want/desire during the credit frenzy.

I practically checked out the entire local library when I was a kid. I built a tree house myself about 30' up in the air. I rode a horse (and got better because I got bucked off said horse a thousand times). We had a big old seriously beat up/out of tune upright piano we got for $50 that I played and played; also a seriously beat up second hand guitar that we were given.

No restaurants (maybe once a month or two out for a #1/#2 etc style chinese dinner), some infrequent camping vacations (never stayed in hotel/motels, no money for that), afternoon matinees once a movie had been out for awhile. And there wasn't internet back then. I did notice all the other kids who had more than us, and saw all their "stuff" and the casual acceptance as ordinary of things/experiences that I would consider extraordinary given our tighter circumstances, but I dunno. The lack of "stuff" wasn't a huge problem for me (but if you'd taken away the library, I would have died).

I had other problems with the family unit while growing up, but a lack of convenience, material things, planned activities that cost $$, etc did me no harm. It is what made me fairly creative as an adult - a gift.

[Warren Stupidity]

7. unemployment 'insurance' is a joke.

As you point out, health care alone will eat most of the tiny allotment you are given. The remainder - all 600 or so, has to somehow manage mortgage/rent utilities and food. There is no way. Luckily benefits will run out soon for many, so they won't have to worry about how bad the benefits are, they won't have any at all.

[prolesunited]

11. Yep, I'm losing COBRA this month

and unemployment is not far behind. I'll be totally liberated then.

[MineralMan]

9. Jebus will provide. Just Prey!

[shawcomm]

10. God I hate COBRA

If Congress would just fix health care, there'd be no need. Stupid previous conditions they're able to use to hold us financially hostage.

[SmileyRose]

12. My numbers told me a long time ago I'm screwn

My household income has never been over 40 grand a year. We got close 2 years in a row when my husband was on mandatory 12 hrs 6 days for months on end - and I was working full time as well. When my husband was working we lived as if we only had one income and used my entire income to pay off our home in full early and put into savings. And then he got sick - and stayed sick. He had no income for 4 years. He now has about $800 in SSDI - before the Medicare premiums are deducted.


I missed a whole year of work while he was at the worst of his sickness and many other days unpaid leave at other times. The loss of income was cheaper than hiring a caretaker while I was at work. In that one year, just one year - with no income from either of us - and this is with our home paid for and no car payments - we used every penny we had in savings plus racked up nearly 20 grand in debts. Cobra payments, co-payments and deductables skyrocketed during a major illness. Costs for vast amounts of medical necessities not covered -- added to all the other basic necessities of life.

For 30 years we've done everything we are told to do. Save save save save save. Live frugal. Save for a rainy day or retirement. It did not do craps worth of good. After a lifetime of living small and saving big, we find ourselves unable to afford the gasoline to drive him to Michigan to see his ailing father. His Dad had to send him the money. I can't even imagine what it does to a man in his 50's to have to asked his dying father for 50 bucks for gas money.

Somewhere in that time period I read Ted Turner bitching because his net worth went from 10 billion to a mere 3 billion. I wanted to punch him in the face.

[DemReadingDU]

26. Sounds like living in depression like 1930's

the rest of us will be there too when the global financial Ponzi implodes

[Donnachaidh]

13. we just came off an 18 month struggle with *no* UI

You can shore up all the skills you want - if the jobs are not out there, you still get stuck sitting on your couch.

Want to really set yourself up to survive whatever is coming? Contact your local labor board and board of health and ask for the lists they regularly hand out - business and groups that help with food and utility payments. Those lists are GOLD by themselves, because if your local county is like ours, you will have to apply multiple times to get food stamps or medicaid. They don't have the funds to cover everyone, so you almost have to fight to get help from the local governments.

Also - if you are already out of work be SURE to tell your utility companies this. Pride doesn't get you anywhere in these times - and keeping the communication lines open can many times get you more time to pay off those bills than when you are working.

Find out the temp employment agencies in your area and sign up with them. Many of them have been swamped and tell you to only call in once a week, but quite frankly, you need to call them daily. Only then do they seem to find work on a regular basis - and it's more to get you OFF their back than anything else.

Inventory what you have of value and really REALLY decide if it is necessary to keep some of it. You *will* at some point have to hock valuables.

It sucks out there, and if we are headed into round two -- may the gods help us.

[upi402]

14. I wont be in US Dollars, however

"Even if you set aside an extra $20 per paycheck, those dollars accumulate and can give
you a critical cushion ..."

Myself, I'd think twice about recommending that bit. The rest is spot on!
I reduced lifestyle after 9-11 and further after BushCo was re-selected. Then comes corporatist Obama. Now I'm selling the rest and making plans on leaving the country. There's no safe haven, just damage control.

[hfojvt]

15. you don't have to pay for Cobra

Chances are very good that you will not have a major illness in the next 9 months. Best to use the money for other things and sign your kids up for SCHIP.

[upi402]

23. Good tip n/t

[dysfunctional press]

31. and- you can get it retroactively...

i don't know if it still works the same way- but 15 or so years ago, when i last cobra'd, you had something like 90 days(or more?) to sign up, and you would be covered back to your first day off the job.
even if you were injured before signing up, you could sign up and be covered for that injury.

[DesertFlower]

16. we had a scare in the early 90s. hubby

thought he was going to lose his job. there were massive layoffs going on. i was on disability and we had bought our first house a few years before. had a mortgage payment of about $1200 a month. the good news is he kept his job, but we really started cutting back and saving. no more car payments. we decided we would keep our cars for a long time. once the cars were paid off, we took the money that we would be paying monthly and put it into the bank. now when we need a new car, we buy them with cash.

he's got 40 years with the company and was eligible for a pension after 30. of course even after 30 years the pension would not have been enough to live on. he wasn't old enough for social security.

right now we're okay. we've got money in the bank, a very low mortgage payment and a nice amount in the 401k, but still a catastrophic illness could wipe us out.

[JDPriestly]

21. Pensions are not sure things these days.

I suspect that a lot of employer pensions will disappear in this depression we are entering.

No way that the job market will improve until we change our trade policy. We need to tax imports to the same extent that we tax the goods made here.

If a company makes a shoe in the U.S., it pays property taxes on its factories, income taxes on revenue (very little but some), the employer's share of payroll taxes, maybe health insurance for employees, gas taxes to transport raw materials within the U.S., Worker's Compensation and unemployment insurance premiums. Also, if the manufacturer sets up shop in the U.S. it has to pay our water, energy and other utility prices. Sanitation -- garbage pick-up and closed sewers are something of a luxury we take for granted here. But in some of the countries in which those cheap products on the bargain stores' shelves are made, people do not enjoy clean water or even streets as clean as ours.

Imported products are cheaper in part because they are not subject to all of these taxes. The answer is not to reduce those taxes. Our standard of living would be reduced along with the taxes. The answer is to bring equilibrium to the tax burden. Imports should be taxed. That's the only answer. If we don't do that, our living standard will decline precipitously.

[CTyankee]

18. I've had a yearly budget for about 20 years now.

And I write everything down. I use separate categories: fixed and discretionary. Right now, even tho retired (involuntarily) with SS and a small retirement fund, it is not enough and hubby is going to have to do some part time work. When that is not longer possible, we will have to sell our house and downsize to a much smaller apartment or condo.

Budgets are your best friends. They are illuminating and liberating. You can see where you can and cannot cut. A budget gives you options if you only will look at your financial picture.

[Tierra_y_Libertad]

19. Unfortunately, you are not "too big to fail".

[SoCalDem]

20. Tips for weathering the storm

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4170362#4173412

[DemReadingDU]

27. Thanks!

That is so good, I had already bookmarked it.

[CoffeeCat]

35. Thanks for that!

That really is amazing! So much information at those links.

Inevitably, when there is a thread like this--it begs questions about survival.
What can we do? Can we truly prepare?

Your links and information are very valuable and I'm sure will help many.

:-)

[Warpy]

22. I did long before I fell into poverty in 2003

and knew I could maintain my ordinary lifestyle for 18 months with no benefits if I didn't get sicker.

With the addition of Xmas and birthday presents from my father, I made it 2 1/2 years. Forget about that ordinary lifestyle, it was beans and rice and cheap root veggies all the way. I bought a quart of real maple syrup at the beginning (my one extravagance) and had about four ounces left at the end. I walked a lot and put gas in my Ranger only every 4-6 months.

The main thing I can say about poverty is that it's boring and was made doubly so because my eyes got too bad for me to read. Because I still had distance vision in one eye, I wasn't blind enough for any benefits.

Going into survival mode means just that and I've had to do it more than once in my life, thanks to lousy health and uninsurablility. Instead of packaged cereal, it's oatmeal from the bulk bin. Instead of soda, it's tea by the gallon. Instead of cable, it's broadcast or FM radio. Instead of movies, it's maybe a DVD rental a month, only if you've got three bucks left over. You watch that puppy until you can recite the lines all the way through.

The one thing I didn't let go of was shelter, but I could see that coming.

Instead of looking how long you could maintain your present lifestyle, consider what you really need versus what you really want and plan accordingly should the worst happen. Talk to the kids about the Great Depression and involve them in the decision process. Consider putting the kids into the same bedroom and renting the spare one until things improve.

Oh, and if you don't know how, learn to cook. That is the one essential to survival, although every single practical skill you have will help.

[bigtree]

28. my 'numbers' haven't added up since I got married and my wife had our kids

I'm always deficit spending.

[Juche]

30. Yeah I have

I've looked into buying a mobile home for about 10-20k (they are fairly cheap in the midwest) and living in that rather than live with family. I figure that way I'd have no rent. And maybe I could even bring roommates in and charge them $200/month and half the utilities.

I figure if that is feasible (buying a mobile home and getting a roommate) then I can probably cut my living expenses down to $600/month~, assuming I don't need medical care.

Yay. I really worry about my generation (the millennials). Some people complain about how spoiled we are, but the reality is tons of economic shit has happened that we are going to inherit


No net jobs in the last 10 years (a 20% net job increase, which was normal in history, would've meant 30 million new jobs in the last 10 years. Instead we got 0)
The boomers aren't/can't retire, so fewer new openings due to retirement either
Wages have stagnated for 30 years and will probably stagnate the next 10 due to the recession
Taxes on the lower/middle/poor class have gone up
Expenses have gone up dramatically for health, education, housing
We enter the real world with a nation whose public debt is almost 80% of GDP
The entitlement issue may cost 50 trillion plus over the next 75 years
Many of us who go to college enter the real world 20k+ in debt
Health care is totally unreliable

Anyway, I'm worried. Higher expenses & higher taxes & stagnant wages & no jobs & unreliable/unobtainable health care & massive public debt (both now and in the future) & massive private debt = our economic life for the foreseeable future.

The saddest part is it doesn't even need to be this way. If we weren't a plutocracy maybe we could implement the reforms to change things.

[mnhtnbb]

32. We are in the process of adjusting to a 45% decrease in income

since hubby has been cut 3 days/week that he used to work in county mental health clinics.
Fortunately, he has social security (67) and a federal pension from all his years working
for the VA Hospital system, together with some private practice income and part time work for a drug rehab clinic. We still have a son in college.

I have been planning to apply for my social security at age 62 (3 more years) and now I'm worried
they're going to postpone my eligibility. I can start withdrawing from my IRA without penalty
in September this year, but had hoped to delay that!

[MilesColtrane]

33. I'm self employed so my unemployment benefits would be 0.

[grace0418]

34. I was laid off in Dec of 2008. I qualified for the maximum unemployment benefit and it

was about a third of my former take-home pay. And I wasn't exactly rolling in dough when I was working. That's fucked up. Luckily I'm in a profession where freelancing can be quite viable and even lucrative, but others are not so lucky.

[upi402]

37. Construction workers not so lucky

they used to be able to do small projects when unemployment ran out. Now it's established practice that illegals standing on the sidewalk outside HomeDepot or Lowes grab all that work. They don't pay taxes or medical so they can work cheaply and live OK.

Flame on folks, but it's fact.:popcorn:
Others pay thou$and$ and wait years to get a visa and then green card.

[CoffeeCat]

38. Fine the businesses that employ illegals...

Fine them $500,000 per incident.

Problem solved.

[upi402]

39. Agreed 110% n/t