Today’s Getting Going column (free) by Jonathan Clements is pretty interesting. He talks about the fact that current signs point to a recession or slowdown of some sort and that one of the ways to weather the storm is to have cash on hand for two reasons:
1. In case you get laid off
2. In order to take advantage of falling asset prices (in other words to be able to buy low)
Here’s his advice for those who are worried about a recession:
- Keep fuding your 401(k) plan to get the full employer match. – I say keep funding it even if you don’t get an employer match or at least utilize an IRA.
- Stockpile cash in a money market fund. – Or an online bank savings account.
- Set up a home-equity line of credit. – Excellent idea as long as you qualify and then don’t spend the money unless you really need it.
- Pay off credit card balances. – ALWAYS a good idea
Pretty good advice.