‘Recession’ has become the most commonly uttered word lately - People are losing jobs, stock prices are hitting rock bottom, property prices are falling. It is all happening and it is not limited to just one part of the world - this is a global recession.

There seems to be doom and gloom everywhere. Actually, Australia is one of the safe havens. We are having our own share of sad stories but not to the extent of America or Europe.

The biggest lesson we can all learn from this crisis is about the risks of high levels of gearing. A lot of people have lost everything (or almost) because of their gearing levels. Borrowing beyond your ability to repay, is never a good thing. High levels of gearing is not a sound investment practice. People with a smile on their faces despite the gloomy conditions around them are the people who did not expose themselves to such high levels of gearing.

Downtimes can also be good times to build fortunes. Everything is on a downward spiral at the moment. History dictates that now is a good time to buy. Success often breeds complacency. But in times like these, we are all so guarded and cautious - and that is a good thing because we are thinking twice before spending on anything. Now, can be a good time to start budgeting and get your finances in order. Most stocks are at prices that they have not been in years. Good bargains can be found in the property market as well. So look around. Well, if you have lost your job then things are hard. But otherwise stay positive. Try and see how you can use the current situation to the best of your interest.

I am interested in finding out how you are turning things around for yourself in the current market…Share your thoughts?

Topics: Saving Money |

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