is the economy affecting your mentality

October 27th, 2008

Is The Economy Affecting Your Mentality?

Every day it seems there is some headline telling me that the economic world is coming to an end.  I am no economist, so I honestly have no idea what the signs are for a true economic crisis.  But I do know that I feel unsettled and nervous about what is going on.  Although some prices seem to keep rising (like items at the grocery store) others seem to now be falling (like gasoline) and I’m not really sure what that means.  Milk seems at least a nickel more expensive every week I shop, while gasoline was over $4.00 a gallon only a few months ago here and now is coming ever closer to dipping to the $2.00 a gallon price point.

So I’m not sure what to think.  The stock market fluctuates wildly,  the words “recession” and “depression” are everywhere, and although our specific and personal economic position continues to improve due to paying down debt, I’m increasingly unsettled about what the state of the nation might do to our position.  We haven’t been personally affected by the credit crunch, just rising prices, and our exposure to the stock market is limited to our retirement funds which I try to ignore right now as much as possible.   But I know there is a distinct possibility we’ll feel real effects of a recession or depression or whatever this is.  I’m just not sure when or how.

I’ve started to have a noticeable reaction to the economic news.  The long and the short of it is that I’ve gone back to my packrat mentality and have started stockpiling items in case they get much more expensive in the near future.   I’m doing it smarter now than in the past, for I’ve put more time and effort into educating myself about what a good price is, how to match coupons and sales and get good deals, and the cyclical nature of sales at the grocery store.  So I’ve been able to stockpile items at rock-bottom prices and I don’t feel like I’ve gone crazy spending money to save money.  But I am stockpiling, and that in itself is starting to make me a little edgy.  Why is it so important to me to have two more boxes of Raisin Bran in the cupboard just in case?  Why do I get all excited when I can get toothpaste free?

This is apparently my reaction to the idea of a recession.  I hoard stuff so that if prices skyrocket, I am already covered.  But my extreme personality has taken that to an extreme as well.  I think it is time for me to start living off what I have and stop stockpiling so much stuff.  I think I might need to stockpile some money instead.

Are you reacting to the idea of a recession?  Has your financial behavior changed?

If you enjoyed this post, make sure you subscribe to my RSS feed!

You can also: Stumble It!  
Submit to Reddit  
Submit to Tip’d

24 Responses to “Is The Economy Affecting Your Mentality?”

  1. I am with you on thinking it is time to stockpile money. I have been tossing every last penny that I can, no amount too small or too big, into savings. I don’t know what all this means either. But I think having money stashed away won’t hurt.

  2. I don’t stockpile due to lack of funds, space and desire. My finances allow for basics only. I have survived many life changing events in my adult life. I have to believe that I will continue to live well on very little, no matter what happens.

  3. I agree with you. I, too, have been stockpiling items. I’ve also been turning much more domestic in the past couple of months. Everything from being more interested in crafting to a sudden interest in canning my own foods. I think something about this current economic situation has sent me searching for my roots and trying to live my life the way that my parents and grandparents did.

  4. The current economy has made me have second thoughts about spending. I also think this is what has made me get serious about paying off our debt. Just this weekend my son said he needed a new jacket. I reminded him that if he looked in the closet there were several that his brother wore just a year or two ago that he could choose from. He wanted a new one and last year at this time we would have been at the mall picking up a new jacket. Not anymore.

  5. I’m not stockpiling (I’m in jinger’s position). But I am very concious of my job performance and how quickly I could lose my job, so I’m definitely working hard there to be more proficient and “needed”. I am also looking more seriously for other opportunities to make money.

  6. I have changed my spending habits some. I;m maxing my 401k, looking for rental units, thinking of buying used 4×4 truck and enjoying the fact I was ahead of the saving mode.

  7. I am also stockpiling in response to the current economic situation. I am stockpiling BOTH cash and food (and household items). I do think that “getting back to our roots” is a natural response to everything that is going on. There is the chance that we will all need to be able to live with less.

  8. For the first time in years, I’ve started using coupons and timing them with sales as well. I’m also attempting to unearth or acquire thrifty-crafty-creative akills as well.

    However, unlike most of you, the economy has already hit me. I’m a massage therapist – half my clients consider my services a necessity, half consider me a disposable luxury. My October income is therefore half the usual, and that’s scary for someone whose rent bill is $2100/month (I’m not extravagant – I’m in Manhattan).

  9. I dunno, mang. Ever since this market-sucking thing has been huge, I’ve been feeling stressed for reasons I can’t put my finger on. I’m starting to wonder if I’m more worried about this than my cognitive self would believe. On the one hand, it doesn’t make sense for me to worry at all — recession or not, I don’t foresee making *less* money or having a less-secure job. On the other, we’re planning a wedding and planning to shop for our first home in the near future, so it feels like there’s *something* out there to put us in financial peril. So … yeah.

  10. I’m stockpiling both money and provisions and I don’t plan to stop. Something is going to happen and I think it will be soon and worse than I can currently imagine. Yes, my job is currently secure, but all bets are off depending on what goes down.

    Check out Karl Denniger’s entry for today, and you’ll stop feeling like you’re overdoing it:

  11. My husband and I are General Contractors with 4 spec houses that we’ve been sitting on for two years, and our own home mortgage to pay as well. When news reports started circulating about the housing market slowing down, things dried up amazingly fast for independent homebuilders.
    Our family went from credit free to completely upside down, home equity maxed out & emptied 401k (plus penalties); and we’ve got a son who was looking to go to college next year. We know a LOT of other builders in the same shape, and if builders are broke, so are the subs and the suppliers. (We’re supposed to be in one of the best areas for home sales. We’ve all been trying to figure that one out…)
    That said, don’t think that we are crazy spenders who are finally getting what we deserve – for twenty years we have lived under our means, saved, volunteered our time and talents to help others, never bought new cars or fancy anything.
    I know that our family and friends will not let us starve if we loose everything, but I pray every day that a house will sell or a new custom project appear.
    All that said, I am NOT stockpiling: A) I cannot afford to. B) I’m not completely convinced that I will continue to have a home to stockpile in.
    Sorry to rant – I’m feeling down right now.

  12. I survived the loss of my job and everything I owned 3 years ago. Now, I think the challenge is to live well on little. I conserve in every way I can, yet my life is full and rich, not in monetary ways. The meals I cook are healthy, full of flavor, yet essentially made from beans, pasta, fresh vegetables, eggs and cheeses. I bake cookies and deserts from scratch.I buy only what we need and can use. I repurpose wherever I can. Just today, I made new embroidered curtains from a panel I found in the thrift store for $1 and repurposed the old curtains into a chair seat cover and place mats. My apartment is colorful, cozy and tasteful and almost everything is second hand.

    Life has many ups and downs…living well, no matter what, can make a difference.

  13. As with others, I’m stockpiling (even hoarding) both goods and money. I have turned my whole repayment/snowballing schedule upside down and for the next 6 months to a year, my plan is to hoard cash and pay only minimums. Sounds heretical, but since DH’s job is pretty secure, and with credit being so limited in general, my biggest concern is having enough liquid, available cash to cover ANY emergency rather than be out of debt as quickly as possible. I think this plan will work because we have extremely low interest rates on our debt, we don’t need a FICO score, yet what we don’t have are huge cash reserves, something I think is imperative at the moment.
    BTW, I heard an odd fact today: the US dollar is actually stronger now than it has been in the last few months. Strange.

  14. I had an extremely hard winter about 27 years ago and have been stockpiling ever since – so there’s been no change in my outlook at all :) Once you go thru a winter existing mainly on clams (we lived on the bay), flour, and milk (we milked the neighbor’s cow for them for free milk), you tend to stockpile more!

    I’ve increased my stock purchases, and my 401K. Trying a winter garden for the first time, and mainly plan on Just riding it out! The winter garden would be my only change – but I had plans for that all along.

  15. My job is rather shaky and I think my husband’s is relatively safe for now but it’s in a traditionally volatile field. We’re thinking of moving to a cheaper place when our lease is up, to reduce fixed costs. We’re thankful that we have decent savings as we’d been saving to buy a house. But that’s won’t be happening now until I feel more secure in my job.

    We’re not stockpiling, but we did cancel vacation plans.

  16. Right on, Sister! I feel a full-blown case of Bag Lady Syndrome coming on! Planted vegetables in the flowerbeds, Moved all my snowflaked savings into cash so I can pay off the little “Renovation Loan” or, alternatively, use it as an emergency fund, and have been driving my financial advisor nuts as I try to figure out how to live without a salary if the layoff rumors come true.

    Not stockpiling food yet…mostly because I can’t afford it and have noplace to store it…but must admit that the general sense of angst just hangs in the atmosphere around here.

  17. It wasn’t until I read this that I realised I was doing exactly the same thing! I’m stock piling! I have to stop and think this through carefully! Thank you so much for pointing this out to me!

  18. First of all, stockpiling is *not* hoarding. Hoarding is when you try to accumulate more than your fair share during a time of shortage. We don’t have shortages yet. Stockpiling enough food, water and necessary household products to last for anywhere from 72 hours (the absolute minimum everybody should have in case of a disaster) to a year is a reasonable, rational thing to do even without a worldwide recession staring you in the face.

    Do I think I might not have any food to eat (other than stored food) for a whole year? No. But what if there were 4 or 5 years of shortages? It might be very useful to have that food to supplement whatever was available.

    It also makes sense because you might be in another situation where you couldn’t obtain food, not because there wasn’t any available, but because you’d lost your job or because the prices were sky high. That’s the thing about stockpiling money. You can’t eat it and you can only trade it for food if a) there’s food and b) the food is affordable.

    It’s true that it can be very hard to come up with the money, but it needn’t be really expensive or take up too much room. You can put it under a table or in the bottom of your clothes closet in limited space. As for what to buy, think beans, rice, rolled oats, boxed pasta, tins of tuna, etc. Buy them on sale (I saw pasta a couple of weeks ago “buy one, get one free”) or in bulk to get the best possible price. Don’t buy things you won’t eat, and eat and replace them on a regular basis using a first in, first out system.

    I’m in the process of building up again, but when I did it before I was a single parent living in under 600 square feet. I stored the food on top of the IKEA double wardrobe that held all our clothes.

  19. I’ve a bulk order to pick up on Friday of 25lbs of cornmeal, 50 lbs of rolled oats, 30lbs of natural peanut butter, and sundry other basic goods. Not only am I buying a lot, but it’s also for a 15% to 50% discount per unit depending on what I’ve bought. I also have already purchased 100lbs of whole wheat flour (at a 50% discount per lb) and 20 lbs of whole wheat pasta. If you have a bulk store around, I would ask about the discount in bulk. Not that I want to seem crazy, but really, even if nothing happens, you’re hedging against inflation all the same, on account of the fact that I can almost guarantee you that prices on food will go up. Oh, and don’t worry, I froze the flour so that the eggs in it won’t hatch. Shudder. For storage, I asked a kid who works at Hardee’s to save me the food grade buckets that they just throw away when they’re done.

  20. I was really worried when I learned that there is an economic down turn not only in US but all over the world. I’m not yet stable with my earnings plus the mere fact that I was just starting to invest for my future and my family. Now I learned how to value little things such as shampoo, conditioner, toothpaste, and food. I never let food goes to the garbage can, I only cooked the exact meal for my self.


  2. » October Link Love # The Shark Investor
  3. Weekly Roundup – Daylight Savings Edition | Cash Money Life | Cash Money Life
  4. Weekly Roundup – Vote Early and Often Edition