We’ve heard more news from the financial sector in the past two months than we’ve ever paid attention to before. Here are some lessons we can all take from the recent news
AIG announced that it was going under about one month. This was due to overly risky investments and bad assets.
Lesson: Be very careful with your investments. Risky investments can bring higher returns, but they can also be lost, thus they are riskier. when investing, be sure to draw a line to how much you’re willing to risk.
We, the taxpayers, gave them an $85 billion loan.
Lesson: Don’t make or accept loans that may not be repaid.
AIG took their tax executives on an extravagant vacation.
Lessons: When you take out a loan, someone else is trusting you with their money. If you get a loan from family/friends, realize that it is their hard-earned money that you are being a steward of and thus, it should be used wisely and repaid responsibly. If you take a loan from a bank, realize that you are borrowing money from the bank’s depositors, just like gov’t loans come from taxpayers. The bank compiles our deposits and loans them out and that is why we get interest rates on our savings accounts. So, again, use loans wisely, you are borrowing from everyday people and your choices should be made with a sense of gravity.
Also, if you are in financial trouble, you should tighten your belt and use every extra penny to get out of debt and back on your feet and to plan for your future. Don’t spend money frivolously. That’s likely how you got in this mess to begin with.
If you loan someone money, and you feel that they are not being good stewards of your money, you have every right to recall that loan. It goes back to how much risk you’re willing to put your money under. It’s your money, you can loan it out, but you can also ask for it back if you think that the road the borrower is on will guarantee that you will never see your money again.
The Gov’t gave AIG another 37.8 billion
Lessons: When someone else is screwing around with your money. DON’T GIVE THEM ANYMORE!
Don’t borrow more money if your existing loans are already weighing you down!
This Sheriff In Illinois has chosen to no longer carry out evictions.
Skipping past the right/wrong and legal/illegal discussion, the lesson is that in these tough times, we need to rally around one another as communities and help one another out.
Passive Dad gives some great ideas to help friends facing a foreclosure
Other ideas are:
- offering to babysit every now and then if you’re home while they work — it will cut down on their daycare expenses.
- Pass along good advice/finds/coupons. I always forward Sale email or interesting articles to a group of friends.
- Split bulk buying trips. If your household won’t use 25lbs. of rice and neither will theirs, you can go to Sam’s or Costco together, split the 25lb. bag and you both save money.
These IReporters are cutting back
Re-evaluate what your needs vs. your wants are. Cut out things you could do without in your life. Whether or not you’re experiencing financial trouble right now, it’s time to reduce debt, and save money. You never know what tomorrow will bring, and that’s all too true today.
Cut back where you can and put your money away or cut away at your debt. Be as wise as you can be with the money you have.