Reframing the Economic Crisis

Okay, it’s no secret that the economy is in the tank. And it’s likely that this has you worried, angry, upset, and stressed out. And it’s no wonder. You’ve probably watched your investments fall, your retirement may be on hold indefinitely, you may have been laid off, your house is possibly worthless, and your credit lines have been cut. It isn’t helping that the media is beating the gloom and doom horse into the ground. You can’t go anywhere without hearing how bad things are, which likely only makes you feel worse.

In this time of misery, I’m going to offer up a challenge. Instead of going along with the gloom and doom scenario and feeling like complete crud, why not try reframing this crisis and its impact on your life into something more positive? Instead of giving in to the fear mongering and letting that fear control your life, why not try to take back some ownership of the situation?

Attitude has a lot to do with how you deal with a crisis. On the night his factory (which contained all of his work and works in progress) burned down, Thomas Edison said, “There’s value in disaster. All our mistakes our burned up. Thank God, we can start anew.” That’s a refreshing way to look at something that Edison could have chosen to view as a career ender. He could have wallowed in pity and failure but instead he chose to look at that disaster as a chance to start over and correct his past mistakes. He went on to invent many more things. Perhaps that’s how we should be looking at this crisis. Not as a disaster of epic proportions, but as a chance to learn something and correct our mistakes, thus improving our futures.

Obviously, this is easier said than done. I know how hard it is, when you’re staring at the bottom of your bank account, to find anything positive in the situation. But it’s worth the effort. What’s your alternative? To wallow in your misery? To consider yourself a failure? To stop trying? That’s no way to live. If you reframe the situation and choose to look at it positively, that is a catalyst for change that can bring you to a new, better place in life. Here are some stories that I’ve heard from people who are choosing to look at things differently:

From Luke, a laid off manufacturing worker: “Sure, I could be really pissed. The company I worked for for twenty years just laid me off with no severance, no benefits, nothing. I don’t have much savings, so things are definitely getting tight. But what good would it do me to sit at home and be pissed? That’s not going to bring in the money I need. I’m choosing to look a this as a good thing. I was getting kind of tired of working at that job, so this is my chance to do something else. I’ve always wanted to pursue my music but I was too tired at the end of my shift. But now I have plenty of time to practice and play. I’ve already got three paying gigs lined up and I’m sending out flyers to give music lessons. I’ve got one kid signed up. I’m still looking for ‘real’ jobs but in the meantime I’m getting by doing something I love.”

From Kerry, a woman whose husband has been out of work for three months: “We can’t go out to eat anymore and I’ve had to get rid of the cable TV. At first it really stunk, but it turns out it was a good thing. We’re all losing weight, doing more things together, and saving money that we really need. It’s a win-win. Even when the economy turns around, I doubt we’ll go back to the way we were.”

From Taylor, a ten year old who had to give up her much loved dance lessons when her father lost his job: “I didn’t want to quit. I love to dance. But not dancing means that I get to spend more time with my friends. Instead of practicing and performing all the time, I get to go to sleepovers and parties. I’ve made new friends and done some other fun things. Mom says I can go back to dancing later, but in the meantime I’m getting to do some things I was missing out on.”

From Allison, a laid off mother of three: “I got laid off four months ago. At the time, I thought it was the worst thing that could happen. But then I realized that I had been wanting to work form home for so long. I’d even been pursuing some of those bogus, ‘work at home jobs’ to see if I could earn enough to quit my job. That didn’t work out, but when I got laid off, I really had no choice. I had to get money coming in, and fast. So I got off my butt and started hitting all my contacts, asking if I could freelance for them. I haven’t replaced my full time income yet, but I’ve replaced about half of it, with more leads coming in every day. I’m finally working from home, legitimately. It’s like this was meant to happen.”

From Daisy, a woman who knows she will be laid off soon: “I don’t know when the axe is going to fall, but I know it’s coming. My company has laid of too many people for me not be next. I was afraid for a few weeks. Then I decided to stop worrying about the inevitable and start focusing on what I could control. I’m stashing money away as fast as I can and sending out resumes like crazy. I’m researching potential employers and making contact whenever possible. I’m not waiting for the disaster to come to me or trying to hide from it, I’m going to try to outrun it. I’ve also started taking some freelance jobs and looking into creating other income streams with some of my other talents. I was complacent about my job and the steady paycheck for too long and now I see that I should have been protecting myself better with more savings and additional skills. But I’m making up for lost time. When the layoff comes, I’ll be ready and I think my preparations will land me in a better place, either working for someone else or doing my own things.”

From Mitchell, a man who is upside down on his house: “When I first heard that I owed $50,000 more on this house than it was worth, I thought, ‘That’s not fair. I oughta just walk away from this stupid loan and let it go hang. It’s nuts to pay for something that’s worth less than I owe.’ But then I thought about it and I realized that I don’t have to leave it. I’m settled in this area. I have no plans to move. So it doesn’t really matter what the house is worth right now. Do I like the house? Yes, it’s my dream house. Am I happy with the neighborhood and the area I’m in? Yes. Then what’s the big deal? The market will turn around eventually and my value will even out. For now I’m focusing on being grateful that I have a house, that I can afford the mortgage payment, and that I like where I live. I’m choosing to look at this as a home again, not an investment.”

From Brandy, a woman who was forced into foreclosure: “At first, I was angry and hurt. I’d never had anything like that happen. I’d always been responsible and made good choices, but this time I got sucked into a mortgage I couldn’t afford. When the house went into foreclosure, I felt like a failure. But after the bruises healed, I started to look at it differently. Yes, my credit is trashed but I learned a lot of valuable lessons. I learned about mortgages and variable interest rates. I learned that sometimes the people you think are on your side really are not. I learned to read a lot more fine print and educate myself. But most importantly, I learned that home ownership really isn’t for me. Even putting aside the mortgage disaster, once I got into the house I found that I didn’t enjoy it. I didn’t enjoy the maintenance and yard work. I didn’t enjoy the taxes and expensive insurance. I know now that I’m a renter sort of girl and that’s okay. That knowledge will serve me well in life.”

From Herb, a man who will have to defer his long awaited retirement: “I didn’t move fast enough to get my investments out of the market. My broker kept telling me to hold and wait it out and I listened, even though I was only five years from retirement. I only fired him after my portfolio was down about 50% and I realized I would not be retiring any time soon. I got mad, for a while. Then I realized that, while I might have to work a while longer, it didn’t have to be at my current job. I’m staying with my current company another three years to get the full retirement benefits from them, but in the meantime I’m also working on setting up my own furniture making shop, which is what I’ve always wanted to do. I do it now in my spare time and I’m good enough to make a living off of it. So, since my retirement is on hold indefinitely, I’m investing a little of the money I had left in getting a business up and running. I’d rather invest in myself and my own money making ability right now than in the stock market. Given my current projections, I’ll probably be able to retire in ten years, not five, but I probably won’t mind as much because I’ll be doing work that I love. Oh, and I also learned that some financial people don’t know squat, so I’m learning how to manage my own investments now so that this doesn’t happen again. No more blind trust.”

From Emily, a woman who had to cancel a long awaited vacation due to a layoff: “You don’t know how long and hard I planned and saved for this vacation. It was going to be our dream trip, a once in a lifetime vacation. But then my husband got laid off and the money I saved needs to go to other things. I was upset, but then I stepped back and looked at it. The place we’re going isn’t going anywhere. We can go when things turn around. In the meantime, I have more time to plan and even learn the language. Being fluent in the language will make the trip, when we finally do take it, that much more enjoyable.”

From Bob, a man who had to file for bankruptcy after a job loss: “I got laid off and we had no savings and very few assets. But we had huge debts: Two big car payments, a jumbo mortgage, and credit cards up the ying-yang. We ended up filing bankruptcy. I wasn’t happy or proud to do it, but it got to the place where it was our only choice. As we were going through the process, I was going through the house looking for stuff to sell. I was amazed at how much crap we had in the house that we never even used. I had stopped paying attention and when I saw all that stuff, I was almost sick. All our money had gone to a house full of junk that no one even touched. After the purge and after we filed for bankruptcy I really took a look at our lives and I decided that this would be a chance to make some big changes. We’ve been working really hard on simplifying and making creating a solid financial future for ourselves a priority, rather than creating a life through spending. I’m employed again and we have maxed out my retirement contributions and are dropping another 20% of my income into various investments and savings accounts with an eye toward both retirement and making sure we never end up in that situation again. The house is gone and we live in a very affordable apartment for now. I could look at all we lost, but I’m looking at what we’re gaining. Had we not had this experience, we’d still be doing the same things. At least this happened now, while we’re still young enough to rebuild and correct our mistakes. This has been a much needed learning opportunity and a chance to start over. It’s been painful, but it’s a good pain.”

From Alan, a man who lost both his job and much of his investments which were in company stock: “I never appreciated the value of a simple life. I was always so busy working and trying to get ahead. But when I got laid off and my company folded leaving me with little money, I had a lot of time to ruminate. Since I didn’t have any money, I had to simplify my life in a hurry. I got rid of a lot of things, events, and people in my life that were dragging me down. I figured out what I want from life and it’s not the corporate treadmill that I thought I wanted. So I’m currently making ends meet with odd jobs. I thought I’d feel like a failure, but I feel freer than I have in years. I make my own hours, pretty much, and I come home to a much smaller (but easier to maintain) apartment. I’m not making the income I once was, but I have enough to cover my needs and put some away for later. I’ve got some extra time and I’m volunteering as a Big Brother. I think I’ll eventually find myself working with kids full time in some capacity, but I’ve got time now to work it out. I never thought I’d find myself in this situation, but now that I have I realize that it was a blessing that led me to a better life.

These are all people who have been hit hard by the recession. They have plenty of reasons to lock themselves in their bedrooms and refuse to come out for a few years. They could easily get mad and sad and sit around hating life and mourning their losses. But instead they are consciously choosing to look at the brighter side and move forward toward a more positive future. Like Edison, they are choosing to see a chance to start over and do things differently, rather than focusing on what was lost in the economic fire.

This entry was posted in Personal Finance, Work and tagged , , , , , . Bookmark the permalink.

6 Responses to Reframing the Economic Crisis

  1. Baker @ ManVsDebt says:

    Great article! I really enjoyed the different perspectives you’ve presented here. It’s important to see how other people are being effected by this slow economy. I don’t feel feel the pinch as much as some others so its good for me to try to put myself in someone else’s shoes.

  2. ceejay74 says:

    These are wonderful stories. There’s nothing more stirring than human triumph over adversity. My partner and I were talking just yesterday about how maybe America will develop some better values as a whole. Capitalism and consumerism aren’t evil unless they take over and edge out every other facet of life, which is what’s happened to the U.S. until recently. My partner, by the way, got laid off and is pursuing her dream of starting a sewing business.

  3. Great! I’d also point out that the economic recession is a good time to focus on “Bang for the Buck.”

    I save a ton of money (and live better while doing so) by stopping for a moment before buying anything and figuring out if it has “Bang for the Buck.”

    Example:
    $20 on a meal at a fancy restaurant? Low Bang for the Buck.

    $20 toward a vacation in Ecuador?
    High Bang for the Buck.

    What do other people think?

  4. Horlic says:

    Great article. Absolutely agree with you . Not only that, attitude has a lot to do with how your deal with other issues as well.

  5. Saving my self says:

    It’s a great time to learn how to save money,save gas saving all around!
    If we start saving these days life can be very easy in the future!

  6. Pingback: Stop Worrying and Do Something - SavingAdvice.com Blog

Leave a Reply

Your email address will not be published. Required fields are marked *

*