It was about 4:30 in the morning when I rolled over in the hotel bed, groggy from a late night pina colada on Malibu Beach with my dad. "Tough luck, kid," I thought to myself. "No rest for the weary." The surf was pounding the shore - weird and wild. It just didn't sound right, too early for high tide, too fast and loud. Then the room started shaking, and before I knew it, my pop and I were both tossed from our beds onto the carpet as surge after surge of the rolling quake cracked the building foundation and shut off the power.

When it got still again, I went to my car and collected some stuff I'd casually tossed into the trunk before this 24-hour road trip: a flashlight, a jug of water, food, a battery powered radio, and a first aid kit just in case somebody else needed it. "Uff... no coffee." My gas tank was full of fuel, and I had cash on me. It was a good thing because back in '94, the infamous Northridge earthquake - the one I'm talking about here - had knocked Interstate 10 onto the road below. The quake also shut off most of the gas pumps and ATMs in LA County. All the traffic lights were out. Fresh clean water was a high priced commodity, and that little "what if" in my ear as I'd packed had saved me and my pop a whole lot of trouble. I was prepared - not just for myself, but those few measures went a long way that day for other folks during the 200 aftershocks. Sometimes the stuff you think is solid is really a quivering mass just waiting to shrug.

Fiscal Readiness 101

A lot of folks can relate to some type of incident like this in their lives. Few would argue with me that there comes a point when it pays to be prepared for certain eventualities. What seems a little histrionic in preparation can mean the difference between success and failure in an emergency situation. Life comes with a load of calculated risks. Most of the warehouse stores sell some kind of emergency preparedness kit, and folks wisely have no qualm about tossing one into their cart. Bookstores never seem to run out of stock of survival guides and field books on self sufficiency. And everybody who's ever flown in an airplane knows that their seat cushion can be used as a flotation device if push ever comes to shove, heaven forbid.

But what about a financial disaster? Our society doesn't seem to place much stock in fiscal emergency preparedness. Sure, you can learn how to balance a checkbook, open a savings account or buy insurance by taking a high school freshman class in General Business. In college they might teach you how to invest in a market or two, if you have the means and presence of mind to take the course. But where can you learn how to maneuver if things suddenly thrust you out of your comfortable daily life onto the cold hard floor of financial insecurity? It's obvious that economic cycles are as relentless and reliable as Mother Nature's cranky moods. Read a headline if you doubt my assertion here. How many people honestly can say they'd know what to do if their financial life shrugged?

What most people do in response to this topic is find the nearest piece of wood and knock on it. That meager act of superstition counts as their sole strategy for fiscal preparedness. For an unfortunate number of auto workers, bank tellers and real estate agents, they're counting on a diploma from Hard Knocks U. and a prayer to the Almighty Uncle Sam to carry them through. Therefore it gives me great pleasure to say you can do better. We all can. You can't always stop the rain, but you certainly can keep your roof from leaking. With that in mind, I give you...

The 7 Keys to Financial Survival

1. Have an Income - It may seem obvious, but the best way to keep your head above water financially is to have a regular income. Even if you work for yourself, keep a steady flow of green coming in from somewhere to cover daily incidentals. Guard your time. For your sustenance, only do the tasks that bring in the highest price you can command. Don't work as a bag boy if you know how to practice law. Cover your costs while you pursue those big dreams. The more you can charge, the fewer hours you'll need to put in to cover your monthly expenses.

2. Have a Second Income- Anybody who's paying attention these days has heard this one tactic from at least a dozen money gurus. Have multiple income streams. Don't rely solely on your day job for your financial well being. A home based business is always a great start. Take stock of secondary skills you have that may be in demand or command a high price. Tutoring a language (including English), dog walking and massage are examples of well paying secondary income streams. Better yet, farm these services out to contractors and take a cut for your involvement in procuring the work. Also think about different ways that you can have money coming in without a great deal of your own involvement. A lot of direct sales companies use a compensation plan that offers you leverage. By bringing others into your business, you can keep the money coming in without being dependent solely on your own efforts. Royalties are another great way to supplement your revenue stream. Billboards and other forms of advertising can be highly profitable as well.

3. Keep Up Your Network - No matter what the circumstances of your life, avoid isolation. Cultivate great relationships with people. You'll not only have folks you can turn to if you need help, you'll have a circle of trust and moral support. Be of service to these people as well, and keep your heart ties strong. Your life will be all the richer for it.

4. Pay Yourself First - I've said it before, I'll say it again. Put aside a piece of your income before you pay anybody else. That includes the government. Sock it away, and don't touch your nest egg. Also put aside cash to cover at least 3 months of living expenses, 6 is better, and include room for eventualities like unexpected travel.

5. Have a Spending Plan - Know where your money goes, and know how much you need to make ends meet. Stick to the plan as much as possible, and include a slush fund for unexpected expenses. Stock up on food and other staples as much as is reasonably feasible.

6. Know How to Get Cash Quickly - Be aware of your priorities, and keep an inventory (or at least an awareness) of your most saleable possessions. Investing in gold and precious stones can be a great hedge against inflation and lean times. Just make sure you don't pay retail, be sure of the goods you're getting, and be willing to liquidate them if need be. Other items you might already have on hand like musical instruments, antiques and collectibles can be sold on eBay and Craigs List in a pinch.

7. Have an Exit Strategy - Whatever you're involved in, and whatever your life looks like, stay light on your feet. Know what you would do if the things and circumstances you rely on suddenly became unavailable to you. Keep a supply of cash or travelers checks on hand, enough to keep you in control of your immediate circumstances. Have a place to go and a back up income source. Engage in mental discipline, and have the psychological strength to carry out your plan.

Keep It Light

How are you doing with these 7 keys? What does your state of readiness look like? What steps can you take right now to improve your situation? Like I said, this kind of talk may turn a few heads. I'm not sayin' you should dwell on this stuff or live in fear that the worst will happen. In fact, I'm clearly stating here that it is your duty to stay positive and be happy - live the best life you know how. But give a thought to promoting your own well being. You never know who you might bring along with you. Not too long ago, some folks would have said I was a little odd, maybe even morbid, if I'd suggested that a commercial airliner would accidentally land in the Hudson River. But a commercial airliner did accidentally land in the Hudson River, and the pilot was prepared. Not only did he himself come out okay, but he brought a lot of good people with him. He didn't set out that day to be a hero. It was just his turn, and he was ready. You never know when it might be your turn. Yeah... like that.

SUBSCRIBE NOW. If you're reading this and you're not currently a newsletter subscriber, you should thank the person who brought you here. They've done you a marvelous service. But it's up to you to keep the hits coming. We'd love to have you aboard. Sign up for our free newsletter, and change your life for for good! You didn't think I could read minds too, now did you? Honestly, I think that's asking a bit much....

For more money tools and tips, check out our terrific Hot Products page at SectorMatic Money Site. With literally THOUSANDS OF ARTICLES and A WORLD OF PRODUCTS, your chances for genuine happiness are rapidly approaching the infinite. Hey, we aim to please. SectorMatic - it's for you!

Until next time,

Jack Schmidt
Spokesman

SectorMatic Money Site
Everything for the Big Spender on a Budget

There are no comments to this entry.