Recession-Proof Yourself
I recently came across an article by Mary Dalrymple and she had a few good points about dealing with a recession.Do not invest your grocery money in stocks. Just because the market took a steep dive keep the steady investing up every month and plan for the long run with the dollar cost averaging. This gives you plenty of time to weather the market’s cyclical ups and downs.
Take risks that let you sleep at night. Stocks will go up, and stocks will come down. If this rule has you reaching for a sleep aid, diversify your investments to match your tolerance for risk. Dave Ramsey recommends noload mutual funds and to put 25% into each of these four types of funds: Growth, Growth & Income, Aggressive Growth and International.
If it seems too good to be true, it is. Now that the market took a dive, my inbox gets loaded with different stock advice for some real winners, especially penny stocks that offer 400% returns. Plan for the worst-case scenario. Have a fully funded emergency fund, that is 3-6 months of living expenses saved.
Let your conscience be your debt guide. If times are tight for your family, you might not need that extra pair of shoes or eating out every other night. Actually, writing out a budget and sticking to it, can show you where you money is really going.
Labels: Budget, investing, mutual fund, recession
Posted By: Joe on Thursday, February 07, 2008
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