• Stop spending money!  If you are worried about a recession, the best way to get ready is to stop spending on anything except necessities.  Real necessities.  Food and shelter.
• Build an emergency fund.  Start with $1,000.  Gradually build it up until you have 3 to 6 months of bare-bones expenses.  Keep it in a liquid asset, like a money market fund or savings account.
• If you have debt, particularly consumer debt, pay it off as quickly as you can, highest interest rates first.
• Know where you stand, financially.  If you’ve never done it, look at your cash flow (income minus expenses) and net worth (assets minus liabilities.  You can’t get somewhere better if you don’t know where you are now.
• Take a skills inventory.  Are there courses you could take or licenses you could earn that would improve your earnings potential?
• Diversify your investments.  There are three main asset classes: stocks, bonds and cash. You should most likely have all of these classes in your portfolio.  A “balanced” portfolio, for example, has about 60% in stocks or stock mutual funds, and 40% in bonds and cash.  What does your portfolio look like?

Stacey and Al discuss how there’s more to our financial choices than dollars and cents.  Check it out here!

http://www.msnbc.msn.com/id/21134540/vp/24064868#24064868

Here’s a link to an article that Stacey and I both like, summarizing some research on the subject, with surprising results:

 http://sciencenow.sciencemag.org/cgi/content/full/2008/320/2?eaf

http://www.msnbc.msn.com/id/23521980/

Since it’s the time of the year for spring vacations, I will be posting a few tips this week about how to have a reasonably priced vacation.

First tip:  Unless you are a foodie, whose main purpose in life is to eat out as much as possible on vacation, find a place to stay where you can prepare some of your own meals.  A room with a refrigerator, a microwave and a coffee maker will let you prepare instant oatmeal and soups, coffee and tea, make microwave popcorn, and have cold water always available that does not cost $1 a bottle.  You can bring the coffee, tea, popcorn and soup with you.  If you have access to a food store, you can buy fresh fruits and vegetables, bread and sandwich fixings for lunch. 

Other things to pack - knives, forks, spoons, serrated knife, salt, pepper, sweetener, plastic mugs. 

If you saved $5 a day, at a 7% annual return, how much money would you have:
· In one year?  $1,890
· In five years?   $10,924
· In ten years?    $26,426
· In twenty years?   $79,639
(Calculations show savings of $5 per day, compounded daily at 7% per year)

Wondering which 529 plan to use?  Vist the College Savings Plans website of the National Association of State Treasurers, www.collegesavings.org.  It gives you detailed information about all the plans available. 

TCOH Authors Stacey Tisdale and Paula Boyer Kennedy bring their unique methodology to retirement planning in a financial special in the March issue of Oprah Winfrey’s “O” magazine. On the stands now!

And make sure that you provide for your loved ones by writing a will.  If you don’t have a will, the state in which you live controls how your estate is distributed.  Are you completely happy with the way your state spends your tax money?  Do you think you’d be happier with the way they would spend your personal money?  If not, then make sure you control how your money is distruted to your heirs.  See a trusts and estates attorney and write a will.