Every where I turn, I see or hear or read something new about the current economic downturn and the dismal economic projections and how this frightening state of affairs is taking its toll on regular people.
I was thinking about it the other day, and realized that just about everyone I know that I would consider a peer is struggling right now. There are one or two exceptions, but they've made HUGE lifestyle sacrifices for their money, sacrifices I'm not convinced they would view as "worth it" in the end.
But other than these rare exceptions, everyone else is struggling. I have my ph.d. and while not all of my friends are as educationally long in the tooth as I am, the crowd I see around me is pretty well educated, experienced, and accomplished. Yet, like I said, hardly anyone is comfortable. Everyone is one bad thing away from a truly nightmarish economic reality. And these are people with solid educations and ostensibly good jobs or at least promising prospects. I can't imagine what it would be like to be a member of the so-called underclass.
Anyway, along with the media coverage of the current/future situation, there's been plenty of information out there for what folks can do to protect themselves as the bottom prepares to fall out and the shit works its way up to the fan, simultaneously. Generally, the advice seems to revolve around a few key points: pay down debt, start savings, and limit expenses. For those living check-to-check (or worse), this is pretty tough to do, but the last few mornings as I'm avoiding getting out of my warm bed, I've been trying to figure out how I can take these lessons to heart.
After my 11 years in college, I have a rather intimidating amount of student loan debt, but other than that, I'm relatively debt-free. I think there's a grand or so on one credit card, but that's it. I suppose I should pay that sucker off, which would be easy enough to do in a month or two if I wanted to really sacrifice or in 3-4 months if I wanted to do so in a more leisurely way. As for savings, well, I guess I could start doing that, but it never seems to work out. Paring down my expenditures is where I've been focusing most of my attention.
I don't have a really extravagent lifestyle. My largest expenditure is my rent, which is way too much, but nothing I can do about that until the lease ends in August. In August, my ass is moving (unless I decide to get a summer-time job bartending or something). Other than that, my next several expenditures are mostly mandatory: electricity, gas, car insurance, cell phone, and then cable/internet. I guess I could look for a cheaper plan -- that might save $50 a month or so -- and I could quit cable, which would probably save another $60, but even so, that's only about $100ish monthly. After that, I have mostly entertainment/food expenses, but other than a nice dinner once a month or so and the money I spend checking out cheap concerts or flicks at the Cinematheque, there's not much left to cut. I mean, paring down is one thing, but cutting back so much that you find yourself sitting at home, no minutes on the cell plan to use, no cable on the tv, and no budget to do things outside of the house - well, that sorta defeats the purpose of living, right? Sure, you can read -- I'm a HUGE reader, so it isn't like I haven't thought of that.
Anyway, all my rambling usually leads up to a point, however muddled it may be. This time, I don't really have one. Maybe a question, though it is mostly rhetorical: Where does one cut back when there isn't much left to cut?
I'm (unfortunately) a yuppie, at least in demographics, if hopefully not in spirit. The problem, such as it is, in my life is mostly a minor irritant. But even so, some months get to be challenging and none of them are flush. How must it be for these folks out there suffering from the burden of predatory lending, as the financial noose tightens and they too have nothing else to cut. Last night, during the Democratic primary debate, John Edwards told a story of a woman from St. Louis forced to choose between paying her rent or paying her gas bill. I could empathize. And if I can empathize, how bad is it out there for the huge chunk of America that is way more over-burdened and under-resourced than me. Pretty bad, I'd say.
4 weeks ago