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12 Important Lessons to be Learned From this Recession

billshrink.com — In such a climate, there is a lot that can be learned. While it would have benefited everyone to know this several years ago, here are twelve personal financial lessons that can and should be learned during this recession and applied for years to come.

Who dugg this? Made popular May 6, 2009

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  • Nore, on 05/06/2009, -1/+301.) Learn How to Plan Ahead

    2.) Learn From Past Mistakes - Then Put it Into Practice

    3.) Learn to Understand, Hate and Attack Debt

    4.) Learning to Distinguish Want vs. Need

    5.) Learn to Save – Even if You Start Small

    6.) Learn to Monitor Your Expenses

    7.) Learn to Stay on Course

    8.) Learn to Take Responsibility

    9.) Learn How to Get Organized

    10.) Learn to Become Competitive and Creative - http://i41.tinypic.com/330zjhx.jpg
    11.) Learn to Become a Deal Hunter

    12.) Learn to Diversify
  • kplo, on 05/06/2009, -3/+27Give that woman a job! Oh wait, she's actually not that creative at all...
  • inactive, on 05/06/2009, -2/+20Learning how to save and not spend all your money from early age is probably most crucial thing.
  • FrozenPie, on 05/06/2009, -0/+18Here's what I learn during this recession:

    1) The Federal Reserve as well as Government policies creates and inflates bubbles by setting lows interest rates and causing investors to speculate and take more risk (see Alan Greenspan, Frannie/Freddie, Business Cycle, etc)

    2) Our fiat currency system is under a lot pressure (see National Debt vs Dollar Value since 1913, Inflation)

    3) Our consumer market and service industry is unsustainable (We manufactured our way into prosperity, and now we've consumed our way into debt)

    4) The Government as well as those connected with them (MSM, Wall Street, Military/Medical/Pharma/etc Industrial Complex) will find tons of way to ***** the general public (see War in Iraq, Blackwater or XE, Haliburton, TARP and every other bailouts, etc)

    5) We have dumbasses on TV
    (see CNBC/Fox laugh at Peter Schiff for 10 mins http://www.youtube.com/watch?v=2I0QN-FYkpw )
    and we still take advise from those who have been wrong about this financial crisis rather than those who were right years before it even happen
    (Nancy Pelosi, Barney Frank http://www.youtube.com/watch?v=iW5qKYfqALE , etc.)
  • Treshnell, on 05/06/2009, -1/+11What you NEED is to have your wife WANT to get back into the kitchen...
  • Perfectsound, on 05/06/2009, -3/+13Don't magically summon money.
  • Barbarino, on 05/06/2009, -2/+11 The list did not talk about the biggest issue out there and that is buying new cars. Buy a used car, pay it off and drive it till the wheels come off. Rich people drive ***** cars. It's a depreciating asset and a huge waste of money. My buddy bought a 2006 7 series for 38k. Car was sold new for 75k. Who ever bought it first got hammered! You know the stealership must of gave the 1st owner 25k for it. Someone lost 50k in 2 years! Even if it was a lease, the 1st owner took a beating of a life time. You can go on ebay and buy 2003 Z06's for 22k... Learn from my mistakes, buy used!
  • Narcism, on 05/06/2009, -0/+8The tinypic was also appreciated.
  • bhuntsbarger, on 05/06/2009, -1/+71 - 12 Save at least enough to get you by for 6 months at all times = my rule.
  • RumpleForeskin3, on 05/06/2009, -0/+5I cast thy Credit Card spell on thee!!
  • Spetz, on 05/06/2009, -0/+5How about: it is unwise to assume that the price of houses will always increase regardless of changes in any other variables.
  • SpoonMSU, on 05/06/2009, -2/+6Don't buy ***** you can't afford.
  • kingmanic, on 05/06/2009, -2/+6will save vs repossession: fail. lose purchase and incur 100 damage to credit score.
  • ProjectGSX, on 05/06/2009, -2/+6Want vs Need?

    But if I NEED my hot wife and she WANTS a new handbag, which one takes precedence?
  • bcronos, on 05/06/2009, -1/+51. Don't let private banks control the money supply of your country.

    "I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." -- Thomas Jefferson
  • carbonfilament, on 05/06/2009, -1/+4I dont usually digg the kitchen posts, but that was good usage. you get a digg
  • carbonfilament, on 05/06/2009, -0/+3that usually works great for me.

    except I'm at month 5.5 right now :(
  • kocurejd, on 05/07/2009, -0/+3Lesson 1: Don't buy ***** you can't afford.

    http://consumerist.com/consumer/clips/snl-skit-don ...

    Lesson 2: There is no lesson 2.
  • kingmanic, on 05/06/2009, -3/+5If its my Chinese immigrant view or do most of these "common sense suggestions" sound like living like an Chinese immigrant?

    My parents were paranoid about debt. cheap to a fault sometimes. could live one extremely meagre amounts while socking away a good percentage of their income into savings. They had long term plans for owning their own business which they did. They started at minimum wage and despite never getting beyond min + a few dollars an hour they bought a house that is now ~460k, put 3 kids through college and bought a business. Thats a typical experience for many Chinese immigrants which came at the same time as my parents.
  • phosphite, on 05/06/2009, -0/+2Thank you Rachael Ray! If it wasn't for you I'd have to beat my hot wife daily to keep her in the kitchen!
  • DarkLance, on 05/20/2009, -0/+1i got a job for her.... selling t-shirts for snorg... thats about it
  • CRCulver, on 05/19/2009, -0/+1Many immigrants of decades past were proud of supporting a family and working hard so that their children could inherit a fortune. However, having children is becoming less popular in Western countries, and people just don't see the point of sacrificing and saving all that money for their descendents when they could be using it themselves to have a good time now.
  • pathouston22, on 05/06/2009, -1/+2Learn how to take advantage of the dip in the stock market. I've made 70% and 35% on 2 stocks I bought last week, and have recovered 40% of my losses when I first started investing last September/October, right before the NYSE crash from about 11k to 7k. And all my long term mutual funds are now in the green.

    Recessions are the best times to buy.
  • Ebacherville, on 05/07/2009, -0/+1One more lessons learned from this resession and the bank bail outs ,
    that no matter how outraged the public is, even in over welming majority, the congress criters will screw you, your kids, and grandkids over any time they can.
  • severed2009, on 05/06/2009, -0/+1One thing not on the list -- no matter where you put your money, some of it can disappear quickly and unexpectedly if the financial system suffers some sort of near or complete meltdown. Escaping a meltdown is something you might be able to do, but your attempts to escape it may also backfire and hurt you even more. Preventing or mitigating a meltdown is the better way to go, but this is not something an individual can do. Only governments and large players in the financial system can have an effect here.

    So the last thing that should be on the list is to vote for government officials who view part of their job as keeping the financial system from meltdowns and near meltdowns, rather than merely helping their constituents to escape or profit from the meltdowns. It is not on the list because those who do not like government regulation have captured our ways of thinking, so that we see only what we as individuals can do, and what we as citizens can do, vanishes. And when we no longer see ourselves as citizens, democracy becomes a sort of ongoing professional wrestling match.
  • CRCulver, on 05/19/2009, -0/+1Do you have a source for that quotation or is this just some sort of apocryphal copy-paste going around?
  • sangjmoon, on 05/06/2009, -3/+413. Be wary of the government when it says it is helping you
    More often than not, the government causes far more damage overall than it resolves. The government simply is far too inefficient, slow and poor at predicting the future side effects of their efforts. Recessions are cyclical, but the shear magnitude of the current recession was fundamentally caused by the government's attempt to help those who normally don't qualify for home loans. When the bulk of those loans went bad, chunks of the money supply built on those bad loans disappeared making the recession far worse than otherwise.
  • daimposter, on 05/06/2009, -0/+1yeah, buying used cars that are in good shape is a great way to save $$$. once you pay it off, you no longer have to worry about the monthly loan payment. Just keep driving the car until the cost of repairing is more expensive than the cost of owning a new car or if the car becomes unreliable.
  • DarkLance, on 05/20/2009, -0/+1"[The] Bank of the United States... is one of the most deadly hostility existing, against the principles and form of our Constitution... An institution like this, penetrating by its branches every part of the Union, acting by command and in phalanx, may, in a critical moment, upset the government. I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. What an obstruction could not this bank of the United States, with all its branch banks, be in time of war! It might dictate to us the peace we should accept, or withdraw its aids. Ought we then to give further growth to an institution so powerful, so hostile?" --Thomas Jefferson to Albert Gallatin, 1803. ME 10:437

    Source: http://etext.virginia.edu/jefferson/quotations/jef ...
  • bcronos, on 05/06/2009, -0/+1Great video of Schiff predicting all of this! I thought Ben Stein was a lot smarter than that...
  • Schralpy, on 05/06/2009, -0/+1The want vs need thing is the best part of the article. Its tough to tell yourself you don't need it, but ultimately very important.
  • tomasII, on 05/06/2009, -0/+1Never let a good crisis go to waste.
  • 999thisisme, on 05/06/2009, -0/+1common sense.
  • consciousman, on 05/21/2009, -0/+1don't spend on unnecessary Items.
  • consciousman, on 05/21/2009, -0/+1I'm currently paying off my unnecessary bills.. If feel good
  • cubicledrone, on 05/06/2009, -0/+1Understand that America has changed at a very basic level. Employers are irresponsible, immature and incompetent, and have no plans to improve. If you want a job, you'll have to build one. That's just the way it is.

    On the bright side, you won't have to put up with some Powerpoint-humping assbag middle manager shouting you down in meetings any more.
  • DarkLance, on 05/20/2009, -0/+1let me save you the trouble next time... see that button next to the article that says "Digg"

    yeah, click that
  • dawngordon, on 09/10/2009, -0/+1learning to distinguish want from need, very good lessons thanks for the share
  • DarkLance, on 05/20/2009, -0/+1hire a hooker, invest the rest into Burburry/Chanel/LV stock
  • naugrim, on 05/11/2009, -0/+113. Don't buy ***** you don't need.
  • xsecretfiles, on 05/06/2009, -5/+5Let's forward this to the Big 3. Also to AIG, Fannie Mae, Freddie Mac etc
  • severed2009, on 05/06/2009, -1/+1The companies that made those loans planned to sell them, so they did not worry about whether they were good or not. The companies that bought them used financial engineering to build newfangled financial instruments from them, paid rating agencies to certify them as safe, and then sold the instruments to investors looking for safety and high returns. The government was generally kept out of all this process, not allowed to regulate derivatives or force mortgage originators to keep a percentage of the product they originated or do much of anything else. Even blatant fraud was not investigated as long as everybody involved was making money. And since the previous administration believed that markets were best left unregulated (the magic of free enterprise) and was in any case generally incompetent and corrupt, it did nothing to keep an eye on what was going on.
    The government did not win in Vietnam and messed up Iraq for years, but this does not mean we can do away with the army. Similarly with regulation or most other government activity. You have to figure out how to make sure it is done right, not give up on doing it.
  • dawngordon, on 09/10/2009, -1/+1good one, we do not use our credit card, we do it by cash or cheque unless it is emergency, to me emergencies are business and home, like I would not pay money to open up websites all over the place, we will be purchasing two domains, two different websites for business only, I will blog the rest for free...I could not justify spending 50 a year right now for fun when it is available to do at no cost, I also read about planning ahead which we do all the time, we meal plan, we plan everything..
  • thinkb4utype, on 05/22/2009, -1/+113. Vote the bastards out of office.
  • shakabrah, on 05/06/2009, -3/+2spend<make at personal, corporate, and government levels.
  • CrazedLeper, on 05/06/2009, -2/+1Pay to:__@raphaeltmnt__ the sum of: __One pretzel ___
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