Given today’s economic challenges, this is not the time to start panicking. Instead we must carefully plan our next financial steps to ride out this storm intact. The steps outlined below are tangible solutions to guide you and your loved ones in making sound financial decisions during this uncertain time. Let one of Optimum’s qualified advisors work with you to start your tomorrow today!

At one time or another we’ve all heard the ominous, monotone and quite frankly annoying tone that typically interrupts our favorite television or radio program to let us know these famous words—”This is a coordinated monthly test of the Emergency Alert System (EAS). If this had been an actual emergency, official messages would have followed the alert tone. This concludes this test of the Emergency Alert System.” We are then returned to our regularly scheduled program already in progress. Like EAS, today’s economic crisis may initially frustrate and confuse us, but we should not panic thinking the world is on the verge of total collapse. Therefore we must heed sound instruction and most importantly use this as a signal to adequately prepare and protect our financial futures.

Rising foreclosures, decreasing values of retirement plans, tight credit lending, plummeting stock markets and bank recovery plans have experts saying we are experiencing our biggest financial emergency test since the Great Depression. But the good news is that all is not lost and we WILL recover if we are patient and diligent enough to ride out the ups and downs of this economic storm.

So How Do I Prepare?

We’ve all heard the advice, “Save for a rainy day” but lately today’s economy makes me wonder if we should be saving for a monsoon! With that being said, preparation is the key to riding out any storm, including economic storms. Most Floridians put together hurricane kits ready at a moment notice with basic survival items just as Californians will have a similar earthquake kit and New Yorkers may have one for adverse winter weather. As a person who rode out several hurricanes and tornadoes, I can attest that being prepared helps calm some of the fear and anxiety that often comes with uncertainty. It gives a sense of peace that at the very least, I know my basic needs will be provided. The same is true for our finances. We can be calm about our financial situation during times like these when we’ve taken the time to plan. Our Economic Survival Kits should include the following:

• Develop a written budget that is enforced and realistic, avoiding large purchases unless absolutely necessary and affordable within the budget.
• Ensure everyone is held accountable for following the household plan.
• Contribute to an Emergency Savings account to cover at least 3-6 months (or more depending on your occupation) of your living expenses in a high-yield savings account.
• Create diversified investment portfolios (i.e. retirement acct) with the proper asset allocation according to your individual risk tolerance and market conditions.
• Consider alternative methods for earning extra income to further increase your savings potential (e.g. selling unwanted items on eBay, consignment stores, yard sales, seasonal employment, etc.).
• Consider barter agreements with neighbors, family and friends for babysitting and other services.
• Maintain adequate life, health, disability and property insurance – now is not the time to drop coverage in order to minimize your expenses.
• Prioritize debt repayment with the goal of being completely debt free.
• Establish estate planning documents such as wills, trusts, living wills, durable power of attorney, etc.
• Don’t forget to continue in your efforts of responsibly “giving” to others who are in need, as we remember the proverb, “Give and it shall be given unto you”.

If you’ve already put together your Economic Survival Kit, Congratulations! You’re well on your way to minimizing your economic collateral damage and today’s economy will test your preparation efforts to sustain your family during financial downturns. But I suspect that most of you are reading this thinking, “I don’t have any of these items prepared for my economic future and I’m doomed for failure.” Not so, as there is still time to start putting these things in place. Even if you are only able to place one item in your Economic Survival Kit, it will go a long way in creating stability during these times. The most critical thing to start doing today is changing your bad financial habits (i.e. using credit card for consumption purposes, not saving) and replacing them with sound financial disciplines that will render the greatest results.
One of Optimum’s qualified representatives will gladly assist you with any questions you may have about how the economy directly affects you. Remember, we are in this economic test together so don’t stress knowing that at some point we will return to regular programming.