Sunday, September 12, 2010

National Preparedness Month - now the hard part!

If you have been following my posts since the end of August ( or want to go back and work them) then you have:

1. Identified the potential emergency situations in your area
2. Also considered other potential hardships for which you need to be prepared
3. Have identified the items that would be most helpful to you in these circumstances
4. Have identified which of these you have on hand
5. Have gathered them into two places: one for food items and one for non-food items.

If you have done these things, CONGRATULATIONS!! You have taken some positive steps toward being more prepared!!

So why does this blog title reference a 'hard part?' Because you are never truly prepared if you are in debt. Huh? Debt? Yep. If you owe more than you can pay off with your cash-on-hand, and one of the things in 1. or 2. above happen, your life will be beyond miserable.

By debt I mean everything from a recently past-due light bill to credit cards to a car to a second mortgage. The only debt you should have is your mortgage and you should be working hard to pay that off-- IF you can really afford a house at all.

Why be debt-free? If you lose your job or are geographically displaced due to one of your geographic vulnerabilities, then you will either default on some of these and ruin your credit score when you need it most, or have something you need during your ordeal foreclosed or repossessed while you are trying to get your life back together.

Imagine that you were prepared enough to evacuate in your new van before the hurricane hit. Your home did not survive the blow. You, your spouse and two children are temporarily comfortably living in that nice van, when the repo man finds you and takes the van. You were even prepared enough to send your payment checks. Unfortunately the bank you use was destroyed in the hurricane and those checks bounced without your knowledge. Repo man doesn't really care about the hurricane or your lost job or the checks you say you sent. He just cares about the van. If he's a really nice repo man, your stuff will be on the street. Thanks, pal. Oh, wait, you brought it on yourself by using something you did not own! That's right!! If it's not paid off, you don't own it!!

There are a lot of people on the internet, radio and TV who make claims about how they can help you. The ones who seem to be most genuine to me are Dave Ramsey and Suze Orman, but their programs do...cost money. (Suze does have some free tools on her website that are very helpful) What a dilemma! But there's hope!

You can also go to a Debtors Anonymous meeting, even if you have the normal garden variety debts, and learn a lot about how to manage your money, spend less, pay off your debts and build your prudent reserve. You can get most of what you need for a donation of a buck or two now and then, but you should go to meetings regularly to learn some of the management tools that work for others.

If you are going to work toward true preparedness, you'll get your spending and debt under control, liquidating/paying off as much debt as possible. Once that happens (if you are not already there), you will be in a position to purchase a few other items you need to improve your readiness for the unexpected.

If you need to work on this aspect of being prepared, consider going to one of the websites for the people and program I mentioned.

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