Financial Education: 4. When Times Are Bad, Watch Your Emotions
During bad times, people (including ounselves) become desperate. That is when the emotions of greed and fear becomes magnified and we are vulnerable.
There will be people working on your fear and your greed, sometimes on both emotions, to try to take your money from you.
Read this for a typical sample:
What can we do to protect ourselves?
Here are some suggestions:
If it is too good to be true, it is too good to be true.
This is the time to invest your time and effort to improve yourself. What the marketplace pays you depends on what you can offer to the marketplace. In fact, you have to offer more than what you are paid, for long-term sustainability.
Give yourself time to reflect on the offer before deciding. Always refer to someone more experienced to counsel you. The proposer will try to rush you into making a decision. If the offer is good today, it will still be good next week.
Prepare yourself psychologically to tough it out. Our parents and grandparents survived WW II. Our situation cannot be worse. Gather family members around you to help each other.
Don't depend on help from the govt. Depend on yourself. Form networking groups for mutual support and do some part-time business. If you have spare capacity, help those who are less fortunate.
The Next Stage Is Losing Confidence
We have to know our history because those who do not know their history is condemned to repeat it.
This was what happened to the Germans in 1923 ...
If it hits the US, we will be similarly affected. There will be widespread panic.
One way to overcome that is to have a plan. Do you have one?
The articles on this web forum contain a lot of suggestions that are useful.
Another point to remember is that we have to eat. Start preparing now by growing your own food. Any food that you can produce yourself, reduces the demand pressure on food prices. If enough people do that, it will help keep prices down, which will help the poorer community.
So, even if you don't want to do it for yourself, do it for the less-fortunate ones.
Developing Mental Models And Dealing With Change
We are going to be faced with massive changes in the economy. One way to cope is to be prepared, to understand what is happening around us, to develop mental models to help us assess new developments.
There are plenty of good teachers around. No point trying to re-invent the wheel.
Here is a suggestion that provides us with a brief overview:
The full course is by subscription but should be worth it.