I spoke with my father recently and he mentioned that every February something major requires repairs at his home. Well, near the middle of May this year that happened to me as well.

Some of the expenses were expected, like having our auto and homeowners insurance due (read: big bucks). We did not expect, however, to have to replace the brakes in my wife’s car ($450) or have our garage door opener repaired ($160). Yikes.

Fortunately our emergency fund can cover these expenses, and after hyper-ventilating a little bit I realized that we’ve ultimately planned for these “unexpected” events by saving a little bit each month. It’s just that we didn’t know what we were saving for, and today we got to find out.

I think it’s worthwhile to think through a few what-if scenarios should the economic downturn continue. Let’s assume you (and I) are blessed and are able to keep steady employment through this downturn. What are you willing and unwilling to do to help out your friends and family?

I, for example, am not willing to help my friends and family pay their (too large) mortgage payment if they are struggling to get buy. I would allow some of them to move in with us, however, and I am willing to support them in other ways. I just don’t think it’s a good use of limited funds to help others pay an extra few mortgage payments that just may be delaying the inevitable.

Are there things you would and would not do in a similar situation?

Jobs are hard to find these days, and we’ve all taken a beating on our investments. Although most personal finance writers tend to state a combination of the obvious and what people need (”get out of debt, and stop being lazy”), I’d like to take a different tact today.

I’d like you to think about how you can improve your financial situation, not because it’s good for you and your family, but because you will be able to help others out that are struggling. Time are tough now, and it’s likely that we will all continue to struggle and worry for some time to come. It’s important to trust in God and avoid a hoarding mentality. Some people have been saving 10+% of their income each year for decades. Although I’m not in that group, I hope to be some day. Until then even I need to avoid the “me first” and “protect your own” mentality and be willing to help others in their time of need. Who knows. You never know who your generosity might touch in the future.

I’ve completed the move of this Blog from Today.com to here, and all I can say is Praise The Lord! To be honest I was growing quite peeved at Today.com, with all of their restrictions it really wasn’t worth the time and effort to get paid a pittance to be hosted there.

I’m glad to have my own space here at upgradeyourlife.buildingbiggerbarns.com, and my goal is to post a few times a month on self-help topics.

As my regular readers know this I cover health, fitness, and personal finance topics here and would consider this blog more of a general self-help blog than anything else.

People love to speculate, especially during tough times. Is the government going to raise taxes? Is my state going to be bankrupt? Will college cost $1MM a year in 20 years?

How should I know. In a country with a constitution that can be changed anything can happen. What I can tell now, however, is that as a country the US is spending more than it’s earning. You may be doing that as well, and how’s that working out for you.

Until we balance the US budget and start saving for our welfare programs, there are only two ways out of this mess: raise taxes or inflate our currency (i.e. repay our debts with dollars that are worth less). It’s likely both will occur, and saving in a Roth IRA will help you avoid a potentially large tax hit when you retire because funds grow tax free in a Roth.

A friend of mine recently told me “I can’t sell my house now, because we won’t get what it’s worth.” I hate to be the bearer of bad new, but market price is always the fair market value. You may THINK your home is worth more. It may even have been worth more last year or a few years ago. The fact remains, however, that the value of an asset it accurate if both parties are free from duress and are willing to complete a transaction.

Therefore it is fruitless to base your decisions on what your house WAS worth. If you sell your house now and buy another house, it’s probably that the new house will also cost less than it was worth.

As the title mentions, the best time to prepare for difficult times is during good times. I know, you’re thinking “thank you Captain Obvious”. The fact remains that most of us are short term focused when we should be (at least somewhat) longer-term focused.

Very few people thing of saving for a child’s college before they have kids. If you think it through though, do you expect to have more or less money after you have kids?

Use your brain a little bit and think about it. Perhaps you should be saving for your own college again, even if you’ve already graduated. If you think you might return to school some day to change careers or get an advanced degree it might be a good idea.

Is borrowing from your 401k a good idea? Well, not so much. First of all the government in the US did this with the social security fund, and now we’re pretty much screwed if you’re currently young. The bad thing though with a 401k loan is that:

• You’re robbing your future by raiding your retirement fund. You’ll lose any growth while the money is borrowed, and that’s the whole point of investing funds for your retirement.
• If you lose your job the loan is due immediately. This is the biggest issue now. It’s hard to get a loan when you’re unemployed.
• ince it’s hard to get a loan when you’re unemployed, most people I would assume end up just keeping the loaned money which will be considered a taxable distribution. Therefore you’ll pay a 10% penalty, get a huge tax hit at your current income level, and you’re retirement will still be hosed.