What does recession mean for me and my family?

Question

how will a recession impact on family spending.

we have no credit cards.

our car is paid for

our mortgage is at a low capped rate for the next 5 years.

will we be able to ride this out?

Answer 1

A lot of people have natural concerns at the moment due to the financial situation. Providing you are careful and dont get into debt I am sure you will be fine, Just watch your money very carefully and make sure you only buy things you can afford. if you can try to save an emergency fund thats what i have done it is roughly 5k so if i was made redundant i could still clain benifit and top this up out of savings.

rich

Answer 2

as long as your main income is secure & stable,the no problems!

Answer 3

As is usual with difficult times, a recession will affect the people on low incomes quickest and hardest. Prices go up and your money will buy less. Providing your families' wage earner/s keep their jobs you are in a fairly good position to ride it out. Probably better than a great many people. You may well have to budget more carefully than you are used to and may have to do without Holidays away from your own home but for you that may be about it.

Answer 4

the price of petrol is up, gas, electric, food, so it will cost more to live, and some business's are winding up because people havnt got the extra money to spend on luxuries, if they cant buy another house then they dont want new furniture, decorating expenditure has gone down, lots of companies are going bust or struggling, so lets hope you work for a company which makes, sells or a service that people are allways going to need no matter what

Answer 5

Well it will affect because even you or any member of your family do not lose their jobs.  Inflation kicks in and everything goes up, gas, food, transportation and the same $10 you used for buying XYZ will now cost you $18 but your income is still the same.  So it does affect.  Every one is now being affected by gas prices, which means less trips to anywere and less vacations.  

Answer 6

The only thing you probably have to worry about is inflation and increased food prices.

The inflation sucks, but the food price increases are infuriating.

The rise in food prices has been largely caused by corn ethanol mandates.

Congress working for us, huh...

Without knowing your financial situation, I'd say you're in pretty good shape. Just stay away from credit cards and consider refinancing your mortgage to a 15-year fixed-rate.

Let's say you have a $150,000 mortgage at 6.5%.

With a 15-year mortgage you'll have monthly payments of $1,299, and you'll end up paying a total of $233,931; interest paid would be $83,931.

With a 30-year mortgage you'll have monthly payments of $943, but you'll end up paying a total of $339,477; interest paid would be $189,477.

So the 30-year saving you $356 a month will actually cost you $105,546 in the long run.

But you seem to be in a good place, and you'll probably stay that way if you stay out of debt. :)

Answer 7

No problem as long as there is some income being earned.