Difficult Days Ahead
By Keith Bunn Jr.
Originally Posted: August 7, 2011
Re-Posted: October 8, 2013
My friends, we have some difficult days ahead. Our political leaders can’t seem to pull their heads out of their politics to do what is best for the country. They think more about their political careers then making the obvious, and hard decisions of not over spending and thinking about not raising the countries ‘Debt Ceiling’, to put this country back on track.
But let’s say they did make that decision, what kind of economic pain would we be looking at? Unfortunately, a lot! As we stand now, the federal government will be taking in $2.17 trillion this year, but will also be spending $3.82 trillion during this same year, which is one of the reasons why we now have a debt of $14.2 trillion. Now these are some huge numbers. For some of us, a little too big to wrap our minds around, so instead of using the government, let’s use a factious household. So if someone’s family was doing what the government is doing it would be like their household income would be $55,000 per year but spending $96,500 a year, all the while having credit card debt of $366,000. If you knew someone who was doing that, you’d call them STUPID! And you would be right!
Now here is something I want you to think about. Think of several things that the federal government funds, it doesn't matter whether it is small or big. Can you see those organizations, research, etc… in your mind? Now imagine that they’re not there anymore. How mad would people get? I mean, people have gotten so use to certain things being there because the federal government funded them every year that if they were all taken away, people would think their lives were coming to an end. It would be like you taking your teenager’s cell phone, iPod, computer, and video games away all at once. They would be throwing a hissy fit! You don’t believe me? Remember what was going on in Wisconsin, when some of the residents there were going to be losing some of their benefits because the state didn't have the money to fund them? And even here in Michigan, it wasn't too long ago, on Facebook, there were some teachers complaining about possibly losing some of their benefits. People are going to get mad. There is no way around it.
Make no mistake. If the government cut all spending except for the military, medicaid/medicare, and social security, the budget still wouldn't be balanced. As of right now, just to balance the federal budget, they would have to cut their spending by 27%. Just to balance it. More cuts would have to be made to start reducing our debt.
Now there is a way to reduce the pain on your end of this mess and this is what I told those teachers on Facebook, and I got some-what ridiculed for it, and that is you need to be in the best financial shape you can possibly be in. If you are not debt free, you need to be. Then, you need to start building wealth. If you are debt free, but don’t have a lot in savings, you need to start saving to increase you wealth. Because the larger your net worth is, the bigger your cushion will be when the pain starts to roll down hill. You need to make sure you have a good retirement plan going outside of your 401Ks or 403Bs. You need to make sure you have a good life insurance plan outside of your company’s plan. You need to make sure you can cover all these things for you and your family, including a good health insurance plan just in case your company will no longer supply those things as a benefit because of cost, and then you’re left out in the cold with no way of getting them because of your finances.
Things are changing every year. You’re seeing and hearing about it all the time in the news. Our political leaders don’t have the capability to fix our lives. WE DO! So lets do what we have to do to protect our way of living and running our families’ lives. When the pain comes, we’ll still have an ‘ouchie’ moment and we can still get mad, but it will by no means be as painful as for those who are not prepared.
The reason I do this, is to give people hope and to try to inspire others. To make people think about their finances, whether they are young or old, so they can win financially.
If you have any questions for me about my posts or if you need help learning how to live on less than you make and creating a budget, you can call me at (616) 454-2046 or e-mail me at email@example.com. I’d be happy to help!