Top 5 Resolutions for 2010: Become Recession Proof

No doubt about it - the economic turmoil of the last couple of years seemed to leave very few unscathed. As people scrambled to stay afloat financially, they started to rethink the way they'd led their lives.

We were among them. Along the way, some newer financial habits emerged. At first, they seemed like sacrifices. But then, surprisingly, they started feeling less painful. Now, heading into the early days of 2010, we're aiming for a recession proof life.

Here are our Top 5 Recession Proof (We Hope) Resolutions for Staying Financially Afloat in 2010 and Beyond:

Because we were personally affected, I have to start with the Bernard Madoff fraud case

This was a real shock because so many people lost their life savings to a guy who seemed charming and savvy. Even more amazing? A significant number were willing to bet their entire financial future on Madoff's so-called expertise.

While I'm not proud that we had a fund within a fund that was connected to Madoff (resulting in an article I wrote here ,) I'm glad that diversification saved us. Even so, my husband and I are determined to scrutinize a portfolio or fund more carefully now and not be afraid to ask tough questions, especially if a fund's performance seems too good to be true.

Bottom Line Recession Proof Strategy for 2010 and beyond? Remember to Diversify Investments and Trust our Instincts

I hope we never forget that one. Hopefully, the memory of Madoff will stay with us. While we'll still talk to financial experts, accountants and investment advisors, we'll be the final judge of what feels right. If we feel uneasy, we'll walk away.

Learning basic home maintenance projects saved us thousands of much needed dollars

If we had the extra dollars, I admit I'd have been more inclined to pick up the phone and call a plumber, handyman or appliance repair service. But the economy got us to try to figure out how to tackle basic home maintenance. I also started saving articles I read online, putting them in a home maintenance folder. The latest? An article written by C. Jeanne Heida, describing how to fix a wooden table with broken joints by using glue and clamps. It can be found here .

Bottom Line Financial Resolution For Recession Proofing Our Lives in 2010? Don't be Afraid To Tackle Home Maintenance Projects

Plenty of information can be found by searching for the information. I liked the information on fixing a wooden table because we had one in need of repair and I didn't have to run to the local library, hardware store or bookstore to get the DIY instructions I needed. We even fixed a dishwasher that wouldn't drain and found it surprisingly easy.

The recession forced us to face the realities and risks of home ownership and high foreclosure rates

Since we live in Indiana, home values don't tend to soar upwards from year to year. Instead, they appreciate modestly. Even so, when home values were rising, tapping into home equity seemed like a good idea. But at a certain point, granite countertops, high end appliances and other things that seemed so important didn't seem to be paying off when it came time to sell homes.

In spite of useful resources like the Indiana Foreclosure Prevention Network, found here, homeowners were forced to walk away from their mortgages and let the banks or lending institutions take their homes. They were simply too deep in debt, with unemployment rising and families struggling to make ends meet. Indiana foreclosure rates remained among the highest in the country.

Bottom Line Lesson Learned from the Recession, Resulting in a New Resolution for 2010? Think Carefully Before Tapping into Home Equity and Keep Debts Low

Even before the recession, we got rid of our home payments as quickly as possible and went on to tackle other debts. We winced as we saw people struggle to keep roofs over their heads. They didn't foresee layoffs and also didn't know they'd be working two or three jobs to try and keep their homes. Some missed relatively few payments before they were forced to sell. But no one seemed to be buying. Those homes were no longer the safe investments, "guaranteed" to rise in value, that they'd seemed.

The recession forced neighbors to help each other out

We went from thinking about our individual home's curb appeal to our neighborhood's curb appeal. Instead of using homeowners' fees to hire someone to landscape the entrance to our subdivision, we worked during the weekends and got to know our neighbors. We had a neighborhood pitch-in when then work was done. We saved a bundle, ready to go back into the neighborhood association fees. Maybe the money will be used for work we can't do ourselves, not even when all the neighbors work together. We'll hire snow plows to clear our streets or use the money for something else.

Bottom Line Resolution for 2010, Caused by the Recession? Work Together on Community and Neighborhood Projects

In one way or another, we are all in this together. Whether time is spent making the neighborhood look better or watching a friend's kids while the person is looking for jobs, the upside of 2009 seemed to be the opportunity to get to know our neighbors, even more than we had before.

We talked to people who'd survived worst, having gone through the Great Depression and learned from them

The recession got people to think about how close we came to another Great Depression (some say we aren't out of the woods yet - and they may be right). But plenty of people could remember having gone through the Great Depression and surviving it. My mother was one of them. She reminded us that even painful experiences are opportunities to learn. And that brings me to the final and ...

Bottom Line Resolution for Living a Recession Proof Life in 2010: Learn from Financial Crises, Remember, Don't Forget

We're eager for the economy to recover and for the recession to be over. But when that recovery comes, we'll keep in mind the resolutions we've made to keep our debts low or nonexistent, save more than ever, stick together as a community and more.

Sources:

Bernard Madoff Fraud Case Hurt My Investments (personal experience) December 17,2008, Associated Content
How to Glue and Clamp a Wood Table Top That Has Broken at the Joints, January 6, 2010, Associated Content, found here
Indiana Foreclosure Prevention Network, http://www.877gethope.org/
Financial Literacy and the American Dream, Inside Indiana Business, here (info on Indiana home foreclosure rates).