Sep 30th, 2008
If the Federal Government was a Friend Looking for Financial Advice…
…I’d tell them to stop acquiring new debt. Right now.
I’d tell them that there were things they wanted to buy that they couldn’t afford–like $700 billion of bailout money and Medicare Part D (well, too late on that last one).
I’d tell them they need to figure out where their money’s coming from and where their money’s going and to figure out how to spend less–by making difficult decisions and sacrifices–and how to increase income–even if it means increasing taxes.
I’d tell them to get started on an emergency fund for rainy days–like the rain that’s coming down right now!
I’d tell them to figure out where their worst debts are and to put the majority of their money there; to consider snowballing their debts or to pay off the highest interest rates first, but to have a strategy of some type to effectively pay their debts, including refinancing them if necessary.
And I’d tell them this was not going to be easy; it was going to be difficult, it was going to take a long time, and everyone in their family would need to sacrifice, but in the end, it would be well worth it.
Funny how if the businesses and individuals who got this financial fiasco going in the first place had done their personal finance homework in the first place… there wouldn’t be a financial fiasco going on.
Well, sadly, no, not funny.
