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Many families have experienced a special mid life crisis, not because of which sports car looks the youngest, but because of the financial tsunami. If you encounter misfortune in the financial tsunami, don’t worry, embrace hope and reorganize.
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Consider the following plan to put the family’s financial situation back on track.
- 1. Own a house: If you try to return to the normal financial track after bankruptcy or other financial disasters that destroy your good credit, it may take seven years to re own a house. We need a house to support our family, but real estate is a moderate investment. Don’t fuss about nothing. Don’t buy a house too soon. Pay extra interest. Consider saving for several years and saving a large down payment. When you buy a house, you can buy a house that is enough for you to live in until retirement. If your credit allows you to get through financial difficulties, it will be the first choice for you to re own the property. When you buy a house, try to pay off the loan completely before retirement, which may not exceed 30 years.
- 2. Credit: If your credit collapses in the financial crisis, it should be regarded as a blessing. It is a good thing to rebuild the reputation after a few years of living without credit consumption. If you can’t get a loan, you don’t have to pay interest. Don’t borrow money, even if you can. Be patient, the important things you lost will come back to you as time goes by.
- 3. College tuition savings: once faced with a real financial crisis, college tuition savings are likely to vanish. But it still can’t stop your children from growing up and going to college. No matter what your college plans are, you have to sit down with the children and talk about new practical issues. If children cannot apply for scholarships that are sufficient to pay for college tuition based on their grades, please help them make plans to save college tuition on their own. If possible, you can let the children live at home when they are studying in college. College accommodation is a huge expense. The children are responsible for their own tuition fees. Tuition tax credit, donation, financial aid, combined with part-time work, can support children to attend local public universities, and there is no need to repay student loans after four years of graduation.
- 4. Retirement: If you had considerable retirement savings before the financial crisis, you can still have them because bankruptcy laws protect retirement savings. It’s great to have money, but if you’ve ever stopped, start saving again. If your retirement savings have run out, saving for the elderly is your top priority. Maybe you have the idea of postponing retirement for a few years, because you originally planned to save more years. It’s better to work a few more years in your sixties than to starve in your eighties.
- 5. Buying a car: Once you climb out of the dark tunnel of financial crisis, never fall into the trap of buying a car with a loan again. Drive an old car, rent a car by the hour, take public transportation, and don’t go to buy a car with a loan. Let people with bad credit records borrow money to buy cars based on two principles: let them buy cars in excess, and then pay high interest. You can get the same return on investment as people with good reputation. Use this principle to start saving money and then buy a car within your ability. Don’t let the car you bought fetter you. Instead, you should enjoy the happiness brought by wise investment and financing.
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By following the above five important principles, you can leave financial difficulties behind and create a happy life.