Change? Yes, We Must.
We are all going to have to learn to live with the change coming our way. The old method of valuing what we own, particularly real estate, has ceased to exist. I am not exactly sure what replaces the “old way,” but I have some ideas.
We first have to figure out what change is going to bring us, what our jobs, retirement plans and day-to-day spending patterns are going to look like in the new globalized economic environment, the “new normal.”
Idea #1: If we don’t learn to save, really save, as in money in the bank, we won’t make it.
Idea #2: If we own real estate, it had better be part our plan to not have any debt on it. Of course we have to have, most of us, a loan to buy a house, especially the first one. But the amount of the loan must decrease every year.
Therefore, Idea #3: Thou shalt not refinance your property, except in the case of life-or-death—literally. A vacation, a new car, remodeling—not life-or-death.
Idea #4: Learn about what is going on in the new economy and plan to change consciously and actively. Everything is going to be changing all around us. If we don’t plan to do with less, save more and eliminate debt, we will not successfully adapt to our new economic world.
Idea #5: Good judgment is going to be back in style. If we don’t accurately perceive what is before our eyes and exercise logical thinking and good judgment in our decisions, we will fail to resolve the stresses that change will introduce into our lives. Poor judgment will not be excused. Sound judgment will have survival value.
©2008/AllenJaworski