Monday, October 13, 2008

6 Ways The Credit Crunch Change Our Lives

The credit crunch has changed the way we live our lives. It has not just turned the financial world upside down, it is sparking a social revolution as well. Here are 6 ways the liquidity squeeze is changing the way we live our lives – for the better.

1. Goodbye bling, hello thrift.
The "buy now, pay later" culture is over. With inflation at all time high and recession in the horizon, start spending thrifty. Plan you expenses and spend only on wants.

2. Welcome healthy living.
The credit crunch ‘improves’ our health, as we cut back on eating out, ditch the ‘rich’ lifestyle and go for more economical but yet fulfilling family oriented activities like picnicking, evening walk etc.

3. Seriously plan for retirement
We will recover from this crunch but another cycle will revisit us perhaps in a decade. Obviously we would be much older then, close to retirement age. If we do not save and plan ahead, not sure if we stand a chance to survive / retire then! Not sure if seeking welfare assistance is part of the plan!

4. Thousands of marriages saved.
Research from Cahoot - One in four Britons says current economic woes make them less likely to split from their partners! Rising bills, household and living costs and given financial teeth to the phrase "for better or worse, for richer or poorer.." Surprisingly, poorer is proving better at keeping couples together than richer.

5. A new baby boom.
Couples aren't just staying together, they are also staying in. That means a baby-boom as cash-strapped couples discover the best things in life are free: until nine months later, when they start splashing out on nappies, booties, prams, more nappies…

6. The work/life balance has shifted.
We were fretting over how hard we were working and how it was destroying our personal lives. Now, nobody is worrying about having too much work to do. Quite the opposite as many workers fear they won't have a job this time next year! There's only one thing more stressful than having a busy job. That's not having one.


Kayage said...

Chee Wee,
You cannot seriously be posting this article! I beg to differ esspecially on your item 1 and 2!

When a nation is looming into an econimic crisis, the idea is to come out and spend!! not the reverse! I believe you learnt that in uni as well. If everyone were to save $$$, the nation's economy will die slowly. Market will be dried up as people won't and don't spent!

Economy of a country booms due to turnover of cash!! the more liquid a country's economy is, the faster it's economy will boom, bro..

What happened to your lesson in economics? Y=E+I+G+(X-M)?
cutting down on the E(xpenditure) will cause the nation's Y(ield) to drop. Or is that not what you learnt in school/uni? 0.0

In times when a country is heading towards a recession, it is your duty as a citizen to call for people to spend spend and spend!! not the reverse!! However, spend within your means lar, bro...

The perspective of saving for a rainy day, i.e start tightening your belt is the thought of the 'old school', bro.. It has proven time and time again that that perspective holds no water and it is against the economic principles!

As for your item #1. Credit card, bro, is still the way to go! You get about 20-40 days credit! Just be sure you pay in full what you spend lar.. Financial dicipline is of utmost importance here! Again, spend within your means lar...

To those who are using debit card or stored value card, As far as you possibly can, avoid using them. Them FI's charge you for each time you swipe that card!! (ggrrr to them!!! )Matter of fact, these cards are non-beneficial. The only benefit I see in them is if you do not have financial dicipline! Then yes, use a debit/stored value card! better still pass all your cash to your spouse and get a weekly allowance! ;)

CheeWee said...

Thanks bro for the tips especially on the debit card.. Wah, u buka buku ekon mana boleh. Econ theory says spend but I think I would rather save! he!he! In practice, we still spend on the necessity - food, clothes, education etc but keep an eye on the interest rate - make sure hv enough saving to cater for the increase in bank loans!

Kayage said...

Bro, tak bukak buku econs lar.. working where I am, i feel it is my duty to correct a wrong perseption. Why do I keep telling you guys that I am doing National Service every weekday? lol!!

There was one day a few months back when I got an article from a commercial banker friend. It was a chain mail asking everyone to tighen belt and all.. Well, I gave that banker a piece of my mind (politely)and got an apologie for spreading that sort of mails. She agreed with me that it is not to the nation's best interest for such chain mail to be spreading after I put up my points.

Yes, in rainy days and non-rainy days, we should always try tolimit our spending on the necessities. Only once in a blue moon should we go luxury.. Saving should be instilled at all times and not just during rainy days, bro..

I am a firm believer of spending within one's means. Before taking that cash out, always ask yourself 'Do i really need it?'. If answer is no, put cash back and walk away :)

Had been practicing this a lot since I left school. One of the reasons why I did not joing the gang to Redang when you guys were in upper-6.. (Not sure if you went with them or not..) :P what can I say, I was earning a measly RM415, gross, at that time.. and Redang cost was then about RM300!!! OMG!! LOL!!