Income and out go

I t has been a big wake up call for me, that the PTBs talking about simply cutting off entitlements. Intellectually I knew it could happen but it is quite different when they come out and say it. I based my financial preparations on the idea that my “entitlements” could be cut up to 30%. Through inflation or a cut at the PTBs level.Ā  Completely cutting off all cash flow to me was not something I thought I would have to face yet. While I have taken steps to protect myself for a few months,Ā  I am unable to pay off my house quickly and becoming a refugee of any sort is not on my to do list!Ā  I know many people believe that cutting entitlements is a bluff and it is, but sooner or later you will get called and that could get very ugly very fast as we saw with the EBT debacle.

I know for myself the fastest way to get money was to start saving it. Prioritizing your spending and paying for the basics first, then looking at things you don’t need or get much value is next. Getting rid of and staying out of debt is a huge thing and it is all to easy to slip back into debt and interest payments. If you start or only make min. payments on your debt you may be in trouble and I know I’m catching myself thinking that if I can make the min. payment I’m okay, at best I’m only okay for month. I have played this game before and lost with debt. I should know better, but it shows how easy the “debt monster” can sneak up on you even if you are aware of it.

For 2014 the goals will focus on cutting the strings of the PTBs that make me dependent on the government and then trying out different home based/ cottage type industries that generate some positive cash flow. Get that wood stove loan paid off as quickly as possible and build a good “emergency fund”. Simple things but not always easy. I think the wood stove and solar panels will payback quickly but I find myself wanting to make just the min. payment rather than retiring the debt as quickly as possible.

I think I can make up my shift in spending fairly quickly and get back on track for clearing the debt I have incurred the last couple of months. I might be beating myself up a bit more than is called for as the last few weeks have been extraordinary. We may face another “shutdown” in 3-4 months and I don’t see anything that makes me think that the economy will come roaring back to life. 2014 is going to be an “interesting” year in the Chinese sense of the word!

10 Responses to Income and out go

  1. “Nothing in life is certain except death and taxes.” I forget who said that but he had it nailed. More and more I find myself tending to worry less about the future and just live in the present. I realize that’s a bad way to be, but there it is.

    • Jamie says:

      Harry I wish I could live in the present but the PTBs have become a major annoyance. But all a person can do is the best they can with what they have to work with. Besides if the PTBs decide to cut off all entitlements they will probably have bigger problems to deal with rather than little old me!

      • riverrider says:

        yeah, this couldn’t come at a worse time either. after 5k fixing the dw’s car and 3k so far on the mil room, i’m nearly tapped out. was hoping to recoup over the winter,now this crap. this is getting real old, real quick.

      • Jamie says:

        river, I have to agree the PTBs timing has sucked for me. Just when I was ready to get all the actual powder, lead melting oven, molds, primers and what not the great gun run happened.

        I complain about the shutdown and all but overall I did a good job at being ready to shift my spending. I’m still “cash poor” but I’m resource rich.

  2. The Soffitrat says:

    How are you set up to buy silver. I would suspect that you might have been making a little extra payment on your principle. If so, you may want to consider small purchases of silver instead. When it goes up to $125 oz., you can sustain yourself much longer than the extra principle payments will do you now. If we had years instead of months you would be better off. But then… wouldn’t we all?

    • Jamie says:

      rat, I’m in really good shape on all the basics. The woodstove and Solar panels are my last major purchase and the give me a way to heat and have some electricity. I have a little silver but I was hoping I wouldn’t need it so soon. My biggest weakness is I am dependent on the Disability for my cash/income since I got CIDP.
      Of course if the PTBs stop everything like SS, VA Disability and other entitlements, 1/3-1/2 of the nation will freak out and I think it would be bad enough if they did a 10% cut. So I’m hoping it is a bluff, but I’m planning just in case it isn’t a bluff. By Jan.-Feb. time frame I should have an extra payment made on the house and cash on hand for my bills for another month even if it cuts off completely in Feb.

      • riverrider says:

        j, check with your lender. usually an extra payment goes on the principle and doesn’t relieve you from the next months payment. it will save you money in the long run(a month of interest) but you will still owe a payment the next month. my aunt made ten or fifteen extra payments but when hard times hit nearly lost her house because the bank applied those payments to the balance, not on a month. you probly know that, but i had to say it jic.

  3. The Soffitrat says:

    Also, if things get really bad and signs of (i.e. – hyper inflation) inflation start showing, stash enough to pre-pay your taxes. I believe the gov repossessed over this during and after the great depression. Pre-pay one or two years worth with what will, in a short time, turn out to be worthless cash. Basically you pay them off with nothing. But they have to accept it. Then they won’t be able to come back on us later. Be sure to get a receipt though. Just some thoughts, and assuming that you plan on staying there, and live through it all! šŸ™‚

    • Jamie says:

      rat, always with the qualifiers! šŸ˜‰
      I’m probably over reacting but I figure it’s best to look at what will hurt you the worst and take steps against that happening or at least do all you can to mitagate how badly you can get hurt.

      If I’m over reacting in three months I will have paid a month ahead on all bills, I will have a cash emergency fund for 1-2 months for the basic bills. So I will be somewhat protected form any bank runs and I won’t have to go out and deal with the mob because I don’t need anything for several months. Even though it screws up my timeline I will be getting things I need to have on hand anyway.

      I hope to stay in my house as it is in a good place and I have worked hard to get this little place fairly self-reliant. But I’m also working on the RV and if things go really sideways I can use the RV and look for a nice quiet spot to wait for the smoke to clear.

      Who knows what can happen, I might be able to pay off the house with a few loaves of bread and a case of beer if the economy goes into Hyper-inflation. LOL

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