This article about double dip recession got me a thinkin'.
I want you to think back to 2008 - 2009, and what your life was like then. Think about your debt situation, your assets, everything that happened to you when the recession hit.
Now think about where you are financially and emotionally today. Are you better off now than you were back then? Did you get your consumer debt paid down or off? Have you set aside money for your Emergency Fund in case of a job loss?
The article states that :
Meanwhile, the Canadian household debt-to-income ratio has since risen to a record of 150 per cent as consumers take on more debt and see their incomes squeezed.
That means Canadians owe $1.50 to banks, credit card companies and other lenders for every $1 they earn.
This is absolutely frightening to me. I took a look at our own personal numbers, and I'm pleased to report that we do not fit that statistic. Which likely means that some other couple who fit our demographic has twice that amount of consumer debt.
We were all warned in the last recession to get our financial houses in order to protect ourselves. For the most part, I think we have accomplished that here in our own family. We still have debt that we are paying down, but not at the crushing level it was in 2009. We took the steps necessary to make things better so we could breathe a bit easier. We've paid off about $50,000 of debt since January of 2009, and have built up some assets. We started saving for retirement and our kids education.
By no means are we perfect examples of a family who has completely done the right thing, but I know we are definitely on the right track. Some of us will take longer than others to reach the goal of Debt Free. But we do alright.
If another recession hits soon, I still think we can handle it and beat this monster debt into submission. Others will not have had the foresight to fix the broken pieces of their finances.
How about you? If we are faced with a second recession so soon after the first, will you be able to weather the storms brewing? Have you done what you could to protect yourselves from financial disaster?