State Of The Economy- Survey

[Wildflower Fever]

I would like to devote this post to the state of the economy, and the fallout of the Wall Street situation.
PLEASE post here if you have recently been affected by foreclosure, layoff, bankruptcy, or a problem with your retirement plan if you are nearing retirement. I think it will be interesting to keep a running tally in the coming months, and I SINCERELY hope nobody has to post here.
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I have not been adversely affected yet, but ironically, I did have an account with Washington Mutual, and my 401K is through Wachovia. Both accounts are safe, by the way. (For now, right?):rolleyes:

[aabram]

We have not been adversely affected (yet) but I see the Royal Bank is about to need help. Just a tick... No couldn't find anything yet on it, but surely there will be something tomorrow. The Royal Bank is our bank, and I hate to think of the consequences this will have on interest rates.

[Amy in Vermont]

I have not been directly affected yet, other than the cost of everything going up. My banking is with local, small banks that are in good shape. My IRA and 401k are small enough that I do not stand to llose too much. I can't touch either of them without penalty, so I will just let them be. My mortgage is safe.

The college's budget, however, is in part funded by its endowment, which is directly affected by Wall Street. We are on notice that the budget is very tight and have been asked to find ways to make cuts. And that was last month... before yesterday..

[Judy]

Well, have to admit was really holding my breath the other day when AIG looked to be sinking. There is a rather sizable annuity there that would have been mighty stunning for us to lose.

[janisian]

Pat & I have been smacked, but not as badly as some - mainly because since I lost everything twice over, I'm big on diversifying. We own a few stocks, we own our house (with the bank), our cars are paid for (lucky us!)
That being said, I'm touring in a van that gets 15 miles to the gallon, so the difference between $2.50 and five bucks a gallon doubles my costs. I'd buy a Prius (as Pat did) and tour in that, but I couldn't carry merchandise then. And merch pays the Foundation, and karma counts, so there you have it. My staff needed a per-week raise because wehn they signed on, I thought we'd have 4 gigs a week with dinners paid for - when it turned out that we had only one, they started to feel a pinch.
I know this is really different from most of you, but in a lot of ways it's the same. From an employer point of view, the US tax code penalizes the small companies (like mine.) I carry full Workman's Comp, which is the right thing to do, but expensive. I insure my shows - ditto. I'm getting slaughtered on insurance for my equipment and presence onstage (every time I hit the boards, it's $150 just in case), and those costs are doing nothing but going up.
As to health insurance, hell!! I'm fortunate that my union, AFTRA, allows same-sex couples insurance - mine is free so long as I make a certain amount in royalties, but Pat costs me a fair amount each month. Still, it's cheaper than a single policy.
Mainly, gas and concert ticketeers are hurting me.
On the other hand, hotels are hurting, so we manage to save five bucks here and there. We've learned to call, and say "Come on. You aren't full that night. What's your best price?"
We're grateful to places like The Phoenix in SF, and Sportsman's Lodge in LA, that actually give artists good rates - I don't know how we'd manage otherwise. I'm the one paying staff & hotel costs when I do a book signing - contrary to popular opinion, no one else subsidizes that, so I'm really really grateful to them.
In fact, if you want to do ME a favor, you could write to http://www.jdvhotels.com/home/ and thank them for making the world safe for singer-songwriters... Honest, they listen to things like that, and people like you convince them to continue their efforts. It makes a HUGE difference for artists, when we can be subsidized by hotels (since we're no longer subsidized by the government) and actually afford to spend a few days somewhere.
Pat and I have some stocks that have tanked, and both our pensions are hurting - but the way I look at it, we're both vertical, breathing on our own, capable of working.
Our mortgage is manageable, thank God.
We've cut back on stuff like watering the garden. (Two very good friends did me a great present two years ago and planted and planted and planted - I think, frankly, they assumed I had a gardener and in-ground watering system. I don't. My current gardening attitude is "I'll water the three new Japanese maples, my lavendar, and my astilbe. If the rest survives, fine. If not, fine. I'm xenoscaping.")
I've gotten acutely conscious of road costs, and am entreating my little crew of two to "think like punk rockers." It's working, so far.
that's where we are...

[hoops]

Janis,
dang, i'm sorry you are getting rocked like that. small businesses always get the short end of the stick. i must say, it's a good thing you know how to cut back and do without. i just pray that you have to do less and less of that and you enjoy more and more prosperity and abundance. not to mention, more and more love and joy.
peace
hoops

[Bat]

Bummer Janis. Just be glad you are still working and not on a fixed income... I took a pretty good pounding, today lessened the dent a little...still put it in a Money Market Fund until I can figure out what is going on. (Me and a lot of other people!)
My car is my own, I have too much credit card debt, and have about half of what I need to finish paying the mortgage, if I'm lucky. Not a good place to be in at my age, but I had a lot of fun getting here...now have to find a job.
Seriously.

[Denise]

Fortunately, we didn't have an ARM mortgage and have a very low fixed rate and it was very affordable.
UNfortunately, we took out a Home Equity Loan about 3 years ago, only wanting $10,000 for small repairs and updates needed to the house, only be talked into, at the closing no less, borrowing $30,000 instead because our "credit was excellent, had plenty of equity, the payment would not be much more, etc.....". We were, without a doubt, responsible for giving in to temptation and using reasoning such as "we can put $5,000 towards that trip we've been wanting to take", etc. We sat there yes-ing and no-ing until we finally gave in....with more prompting by the loaners.
NOW I wish we didn't do that because we have a 2nd loan with a bigger payment than planned AND our house value has gone down so much that we almost owe more on it than it's worth. So forget re-financing and there will be no help for people like me and millions of others who fell into that trap.
We are paycheck-to-paycheck, able to pay our mortgage but just getting by with the high cost of groceries and gas added to the picture. I hate to even look at my retirement statement when it comes anymore. It all sucks....truly sucks....
And just to add to the misery, I went for my inspection sticker for my car on Monday for $12.50 and left paying $288! I needed 2 new front tires, added an oil change, etc... blah..... so now groceries will be tight this week.
My poor daughter who cannot be on our insurance anymore has CRAP insurance from her employer. She went to the doctor for a swollen foot in August, had x-rays, was told to go to an Orthopedic Dr, did that and was told she needed better ($100) supportive shoes for work....total cost around $435... and her insurance company paid $22.00 of it! WTF?!
Sorry I'm on a roll..... lol...

And btw, Janis, to save money if you ever come close to my area again, PLEASE, my doors are open, for you and your bunch, to save on your overhead for a night!!!!
I might be serving you Kraft Macaroni & Cheese however..... lol!!! Oh my... :(

[hoops]

i second the offer of a place to stay. it's small, but it's homey, and i certainly will stay out of the way.
i have been lucky enough to own nothing, i pay rent, i have paid off my credit card debt and refuse to get another card, my bank card works just as well and i know i have the money for what i buy. i can fix most things on my car, i cut and color my own hair, i do my own maintainence around the place. well, anything that doesn't require landlord intervention. i only have to drive to work and to visit people and i get paid for gas to work. i don;t eat much, i have no savings, stocks, investments. yes i live month to month, paycheck to paycheck, but i survive. my medical bills, well, i thank God, I'm disabled ( odd, i know )but between medicare and medicaid, i pay a very moderate amount. afordable...my future, i'm sorry to say,relies in whatever settlement i get from malpractice for all thaT CRAP. i'm very lucky i guess, and i am grateful. i wish prosperity and abundance for all of you, and of course, love and joy. call me pollyanna, but i belive God, the universe, our higher power, whatever you choose to call it, wants prosperity and abundance for all, we just need to ask for it and then welcome it and be open to it. just a small example. after recently speaking my acceptance of abundance and prosperity i won an award of $500, i was repaid an overpayment of nearly $500 and i was given out of the blue a bonus of $100 by my employer...all within a week. good luck to all...and that is just financially, i could go on and on over the emotional, spiritual, mental, loving and joyful abundance i have gained recently
peace
hoops

[diver_boy]

everybody is feeling the pinch so to speak. i've lost 15-20% in my 401k, and finding it difficult to get bills paid. but where there is a will, there is a way.

every penny counts nowadays, that's for sure - and with the economy being the way it is, i'm blessed to have a full time job with medical benefits (even if they cost me $150 a month.)

...there has to be a way out of this mess.

[Judy]

Ouch. Just had propane delivered to the tune of $1,800. We have a moderately large house with 2 heat-efficient furnaces, insulation & insulated windows, doors etc. The propane will probably last until Feb or first of March and, of course, doesn't include electric bills. Cripes, when you have to budget in $2,000 on hand for heating that can get intense.

[DaveM]

I may not know for some time whether my personal situation will be affected much if at all. For more than a year I have gradually shifted the bulk of my business offerings from "wants" to "needs", and it seems to have worked as my sales have remained steady--the decline of the dollar has led to a major increase in international customer which means a bit more work but has not been much of a hassle (I let Europeans pay cash in euros if they wish and sock them away). I have no money in the stock market. My house and car are paid for. I have no credit card debt.

That said, the tank of fuel oil which used to cost $130 is now over $1000. I installed solar panels this past summer which I hope will offset up to 30% of the furnace (and those are paid for), but the bill is still going to be steep. And of course, there are no bargains on gasoline or groceries.

A portion of my income comes from a trust fund which is for the most part in two CDs and well under the FDIC insurance limit. Interest rates have of course become a joke, but as long as U.S. currency remains solvent, I have a bit of a reserve there.

So, for the moment at least, I don't see any major changes affecting me. Then again, in the current climate, that could change overnight. In som respects, I'd be happier if my savings, such as they are, were in euros instead of dollars.

[Beth]

Part of the reason that I closed my independent practice (10 years) as an OT and went with an employer this Spring was because it was getting truly impossible to make ends meet. Gas was killing me and the cutbacks in state spending on the disabled population I served essentially had me working for next to nothing. We are a family of five and we have always lived very simply, but there is a bottom line. My partner and I both work with the disabled and I do worry that substantial cuts are coming. As long as we can both stay employed, we'll manage OK. We don't have much but what we have is spread out. We have a small amount in stocks, but have always looked at that money as "disposable" in the sense that we would be OK if we lost it all, in the worst case. We own our cars and have a reasonable mortgage. I have student loans but there is no other debt to drag us under. My biggest concern is that cuts that may need to be made would be things that we would no longer be able to do for our kids. That would be really, really hard for me. But as long as we are healthy and together, we can get through anything.

[AceOn6]

We're feeling a bit pinched, but aren't in dire straits. We have 8 years left on our very small mortgage. It's with WaMu, however, and are concerned about who will take it over. We're fortunate enough to have cash to pay the contractors who are working on our house, so we don't have to tap our HELOC. I work in the health sector, and that's not going anywhere anytime soon.

What is killing us is heating oil. It costs over $800 a fill right now, and we get a fill every six weeks during peak season. We're hoping that the insulation and new windows we're putting in will result in filling every 7 or 8 weeks instead. Keeping fingers crossed!

[Bat]

I ran into a snag with my IRA which is in Mutual Funds... they only trade once a day, so I had set up to sell the funds and get into a Money Market Account until things settled down, but...since I get a draw every 1st of the month from those funds, the sell and the draw just happened to both fall on the 1st of October. Do I leave the Funds alone, get my draw so I can pay bills, or do I sell and take forever to set up the draw again from Money Market?
I left it alone, hope I do get my draw in a few days...that takes a while since the funds have to be sold and get put into a bank which then makes the transfer, which can take up to 4 days (which I didn't know, and was wondering why it was always showing up late in my bank).
Now the market has gone down again, my funds are suffering, and it's a total pain in the patoot.
The question is, should I stay in Mutual Funds, or get into the Stock Market?
I'd really like to hear some opinions on this one!

[trish55]

can't complain too much. never had much in terms of material stuff, no stocks, ira's or anything so actually didn't and havn't lost anything:D

[lucille]

For a down under perspective, I have lost about one third of my superannuantion (pension), and day by day it diminishes. I had the recommended amount to live a modest to comfortable existence as a retiree. Now I will have to keep working. Not that I ever intended to fully retire, and hoped to work just a couple of days a week. I have a small mortgage, but own everything else. I have good private health insurance which costs $180 per month. My MG is very economical, and my station wagon runs on duel fuel, petrol and LPG. I hardly ever use it on petrol – maybe a 50 mile run every now and then which is recommended. I also have a motor scooter.

My business is very slow, and I will have to move out of the Brighton premises as the landlord has increased the rent from $2,200 to $3,000 per month. I think he may regret this move, as all the shops in the strip are struggling to survive. I have found a new premises in a very nice suburb of Geelong (50 miles down the bay from Melbourne) which is affordable, and a new start. It is situated just minutes from where I live, so I will save on transport to and from home. It is also three times as large, and has a very large outside area which I hope can be converted to a sculpture garden.

My accountant thinks I may qualify for a small government “aged” pension which although will be small, it will qualify me for reduced rates for rates and taxes, utilities and car registration etc. It is very rare that Aussies use oil for heating. It is mostly natural gas and then electricity. The country has a plethora of gas fields, so we are lucky from that point of view.

So things change, and I am optimistic enough to believe that when one door shuts, another one opens. I just hope the other one doesn't slam in my face. Actually, I think I even have a new lease on life with the new challenge ahead. I will certainly have more storage room, which I needed desperately, so that alone will be worth the rent.

Apropos of Janis' monthly update comment about a search for an island to spend some time on – I can only say that Australia is an island! There's always accommodation here, modest as it is.:D

...and PS, I had to buy two new tyres for the MG yesterday - $349!!!

[DaveM]

Wendy, you should be grateful when an MG only needs TIRES.

[lucille]

Wow, things must really be bad over there. I got a call yesterday from a friend in California. They want me to send them forms to open up a bank account here (banks have term deposits at 8% at present), and they are going to transfer all their money. When I went to the bank they informed me that they are getting quite a few enquiries from the U.S., and have opened many accounts over the past month for Americans.

[gisli]

I guess we all are feeling something.....

http://www.portfolio.com/views/blogs/market-movers/2008/10/03/iceland-when-too-big-to-fail-becomes-too-big-to-rescue?tid=true

[DaveM]

Wendy, there's been a persistent rumor for the past several years that wealthy Americans are transferring money and buying property in Australia and New Zealand. No idea whether there's any truth to it, but if there is, I'd bet that the current crop of Republicans are at the head of the line.

[lucille]

Well my friends are far from wealthy Republicans I can tell you. He feels that his very good job is at risk, and told me that if McCain becomes the President they are moving to Australia! They have visited here a few times so know our country well and its lifestyle matches theirs.

They currently live in California and have a holiday house at Cape Cod so they are comfortable financially (so far), but have worked all their lives to get there, and now see a poor future in the U.S. so close to retirement. They want to sell their real estate, pay off the mortgages and have somewhere to keep what's left, safe. Don't we all?

I am about to do the same with the two properties I (and the bank) own, and bung what's left over in an interest bearing term deposit. The 8% presently offered won't last, but it's still better than the minus returns I am getting from my superannuation.

[DaveM]

Somehow I don't think emigrating is an option for me, but believe me, I'd consider it. Unfortunately, I don't really have a job as far as immigration people are concerned, and my medical history would probably drive them nuts as well. Ah, well....must say that rolling hills and sheep sound far more attractive than iron mines and drunken miners. Most of whom talk Republican and vote for Democrats.