I help recently unemployed individuals with job search and resume revision, so I try to keep up on what’s happening. There’s a lot of doom and gloom in the press. Some with merit, some not. I glean what I can and blow away the rest.
Interesting to see the trend that this recession isn’t necessarily following trends of those in the past. One article from this morning’s WSJ discussed that many jobs became unnecessary over the years, but still existed in a good economy (i.e. receptionists, many administrative positions, some finance industry "extras"). Many are gone or in the process of being eliminated due to budgetary constraints. Some are replaced with technology; some are just not being replaced as they were duplication of efforts in the first place. Some are being outsourced to other countries. Other positions are seeing a dramatic reduction in salary, (honestly, bringing them back into the realm of reasonable... I'm waiting for the day professional sports salaries "get real.")
So, if people are in the position where they can’t do what they used to do or if they can, it’s not for the same wage, what next?
It may sound elementary, but if you’re in a leaking, sinking boat with all your possessions, the logical thing would be to start throwing some things overboard. There are precious few of us who are at a “bare bones” place right now. Redefining “necessity” is a healthy exercise. It’s so easy to misinterpret the “nice to have” for the “need to have.”
If you don’t have a goal of living within your means, then you may as well stop reading now and go charge a $7 cup of coffee at Starbucks, and for kicks, add a $4 bagel because you “deserve” it. All others read on.
Try listing all your expenses, and if appropriate, your spending “habits” as well. (These things often get omitted from the true budget but seem to eat it alive!) Then, honestly ask yourself what the consequences would be if you eliminated that expense. Some may be dire consequences. A diabetic throwing the insulin overboard - not a good move. Some things may be removed temporarily with a date or event given for when they may return (i.e. “by summer” or “after first full month of employment”)
After you have the “necessities” in the budget, look at what’s in your control to reduce them. Can you trade services for anything? Can you get a discount on anything? Consolidate or bundle your telecoms? Is eliminating a car feasible? Can you change where you shop?
This takes practice. You must stop and think - Does the consequence of affording the service/item outweigh the consequence of eliminating (or reducing) it?
The bigger challenge – Decide how you will reframe your idea of abundance to match your goal of living within your means.
If you’d like to discuss this exercise, write to me at Julie@julzoflife.com or comment below.
Wednesday, January 13, 2010
When the Boat’s Too Heavy, Throw Something Overboard!
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2 comments:
very cool
godofredo
"Interesting to see the trend that this recession isn’t necessarily following trends of those in the past."
That's because this is not a temporary cyclical economic downturn. Rather, it is a structural decline of the American economy caused by an economic force few people understand called Global Labor Arbitrage.
Our nation's economy will not recover because we are losing the basis for having and maintaining a solid middle class, which is the ability to produce real wealth. By sending our manufacturing overseas and becoming dependent, we outsourced the basis of our being able to have a high-end service economy. Then to top it off, we imported foreigners on H-1B and L-1 visas to displace Americans from often college-education-requiring knowledge-based jobs. Then we imported tens of millions of poor immigrants to displace Americans from poverty wage and blue collar jobs while also driving down wages.
It's hard for your nation's economy to recover when its wealth is being sucked out of it. For example, much of the stimulus money ended up in China, and the newspapers reported that 80% of the green energy money ended up in China.
So, this isn't a normal recession. Rather, it's a structural downturn as the nation merges its standard of living with that of the billions of relatively impoverished people in the third world and thus transforms itself into a third world country. (We're also going to be overpopulated, which will decrease the amount of resources we have per capita while increasing the costs of those resources, such as energy resources, land, clean air, and freshwater, etc. It also increases the strain on the environment.)
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