I think there’s room for both sides of the discussion but the value is in taking them within their respective contexts.

I’ll serve as my own example… I accepted a buyout that came just prior to 2 or perhaps even 3 rounds of layoffs from my previous employer. Because my performace was good – I had just been promoted and received a nice raise – I know the buyout was in response to the economy.

In that way, it is inescapable that I am a participant.

At the same time… I’m not given to panic and dispair. I have some cash and I’m being intentional with it and it provides me with comfort that is independant of the economy.

In this way, I am NOT participating.

Clearly, if my budget was a mess or I had elected to give my buyout to GM I’d be in a mess. The bad times are real and I don’t discount that. Nor does Dave Ramsey, I don’t think. He acknowledges that some folk are impacted.

But his message is really to all the people – the vast majority really – who have jobs and are not really impacted other than by their own reactions to all the negativity. These people are basically participating in an event that is not really touching them.

Hmm…. more words than I had intended but that’s because this is a layered and nuanced issue. And there are mixed emotions along the lines as well.

Someone loses their house and I feel bad but if they have 2 leased cars and a crazy house payment then their level of participation is kinda their own fault.

You’re mom’s situation is bad – and I hope it improves. But really it’s a tough deal in any economy.

Thanks for sharing and sparking such great discussion!

Godspeed to your mother’s health.

Dave

3 years ago, an industrial accident caused me to lose my job, (6 weeks in the hospital, 7 surgeries, just so I could walk again), and at the same time, my wife saw her job outsourced to an offshore company.

With very little income, and very little prospect of any, we faced a harsh reality. But we refused to give in or give up.

We pulled together and decided that there was nothing that life could throw at us that was stronger than we were together.

The last 3 years have been rough, But we both have refused to let the economic crisis become our own personal financial crisis.

Resources like your blog provide us with information and inspiration as we continue our battle.

Frugal Dad, I do hope your mom recovers quickly and does indeed get her old life back. I lost my mother at age 57 due to a stroke. I know exactly what you mean about appreciating what you have and preparing as best you can for the future. Best of luck to you and your family!

The most important thing is I will pray for your mother and family.

Neal

I agree there are many factors to each of our situations which we cannot control, and therefore have to react to, but it is how we react, as i said in my post above, that denotes whether or not we are ‘participating’.

I have read all your comments, and some of you are quite open indeed about your personal situations. So here is mine if you might like to know – its i touhg one in my opinion. I went form private school mum with 2 companies, to a debt swamped homeless person living at parents within 3 months.

Up until just under 2 yrs ago, 3 of my children attended private school. Our children are now aged 17, 15, 10 and 20 months – they had done so for 4 years, we had a retail fashion shop in a surfing district in england UK, i have a small specialist company which has been running for 15 years, its not a great profit maker, but it earns me an income and covers its own costs – i am fortunate to still have it.

By summer 2007 our shop sales were dramatically falling month on month. By August 2007 we were getting behind on payments for things – both for the shop and at home, we realised it wasn’t going to change very quickly. The kids had to come out of private school at very short notice as we couldn’t afford the fees any longer – these were about 12k per annum per child at the time, we cut back on all our costs DRASTICALLY including our rented home, and retreated back to parents, with 3 children and a brand new baby – born in August 2007 in order to keep the shop open.

By Novemeber 2007 we were at 30% of previous years turnover, we couldn’t continue. we returned stock, closed down and pulled back. We have 120k debt from closing the shop. We had 89k personal debt – loans credit cards – all sorts, suddenly we didn’t have the income to pay for any of it.

We are still at our parents, my eldest son is living away from home and working instead of heading to Uni as he would have liked, our other three children are at new schools, i am still working, we are clearing debt slowly, we are saving for a deposit on a house. Its almost like starting all over again. The news might say the recession started in September 2008 – if you ask me, it really started a great deal sooner than that, but noone would admit it.

It’s a frustratingly slow recovery for me and my family. Its cost all of us, and not just in money, but i follow this and several other blogs to get tips om what and how to save and clear debt more quickly. As far as i am concerned i AM NOT PARTICIPATING in the recession. It hit me, and i am now in recovery – albeit slow! I got off my backside and made a plan, and i am trying to implement it. I have less money and a lower level of lifestyle in some respects now than i did before BUT I am not adding to my debt anymore, i am living within my means, i am reducing what i owe, and my carbon print,a nd living frugally, and ‘making do and mending’ and so on and so on, and i am widening the gap between my small income and my outgoings. The gap is for emergency fund debt clearance and savings.

I have learned alot from having been hit hard and knocked sideways. My dad was giving me frugal tips when i was in my twenties. I am now 38 and only just starting to think about being frugal – what time I have wasted! Now i have to claw back and be frugal for the 50 years ahead. This clean up game will take me another couple of years i think. Then i can live a bit more comfortabley, but i will never again take any more debt on -outside a mortgage. I will instead make do and do without and save until i can afford it – whatever it is.

I feel like i am doing something positive, despite the slow progress. I knocked 32k off my debt in the last 18 months. I haven’t gained any more debt. I have saved a small emergency fund – but emergencies keep happening – life keeps happening to us – at least its waiting for the emergency fund to be big enough to cover it each time though! Manifold has just gone on the car – yes today – as i write!.

So – to come full circle, by no means am i in a comfy position, looking down my nose at strugglers who are participating in this. I am a struggler too striving to get out. I don’t class myself as ‘participating’ in this recession though. I class myself as ‘participating’ in doing something to get out of it, and hopefully eventually teaching – if only my 4 children – how not to get in the same sort of mess i did, by making the choices i made.

Another thing that occurred to me form reading all your posts is that we all talk about ‘getting another job’ – that means finding someone who can afford to hire you, well most companies – much like my shop , can’t afford staff. Staff are the first thing to go if you try to keep the company going. So actually i should mention the people whose lives I affected by having to lay them off from work in my shop. That is not nice to have to do, and know you have put all those people in that situation – but there was no choice. And ’staff’ often don’t realise their functioin is to increase the profitability of the companya nd to do a good job. Some staff (not mine) think it is their ;’right’ to have a job, and to keep it. Well no its not – no-one has a ‘right’ to have a job anywhere, we might deserve our jobs – that is different. If you have a job now, do your best to keep it, don’t view it as your ‘right’ view it instead as your reward for doing a good job, which keeps you in your job. Also those wihtout jobs, find something else to do. Be self sufficient.
Before the industrial revolution, jobs were not really heard of for the masses! People had to maintain themselves. Money was something which was saved if earned as it wasn’t really needed to live. Food, shelter, clothing, thats the basics. I personally think the world – the western world has reached ’saturation point’ – thats why we are having this recession. things slowed down at the top – not because people couldn’t afford things anymore but because they already have everything they need – take cars for example – but their old car lasts longer, they are already maxed out in debt and don’t NEED to geta new car, and the follow on from that is nor do the people with the older cars. Cars are better and last longer, so noone NEEDS a new one. Now apply that to most LONGISH LASTING white goods, electrical items. Then everyone has had all the credit they can get their hands on , so no more credit to spend on this stuff which we don’t need more of. then the jobs go, then the income goes, then can’t pay credit. Its a vicious circle.

We all need to go back to simpler living and the manufacturers will have to cut back accordingly, this is causing a shift in lifestyle and possessions etc. Now we need to move towards ecological power production – which is where i see the next revolution. Everyone who can’t think what to do to get out of their bad situation, start learning about this and spend your time on coming up with ideas to provide for all your needs, without money and without non ecological power.

With that, i had better get on with some work in the hope of earning some money to allow myself my hour a day to learn about stuff which could improve my life or finances!

Speak to you all again soon
Toni

@Mary: Thank you. She is making strides, but still has a long recovery ahead. It has been a long, grueling eight months for us all – no more so than for my mom. She often tells my wife and I, “I just want my life back.” A sobering reminder of how quickly things can be snatched away.

I think one can choose to not participate in that aspect of a recession by simply doing what is best for him and not reacting emotionally or out of fear because he hears the sky is falling every day on the nightly news.

For example, if you need a new car and can afford it, then buy it. Buying too much house or a new car you don’t really need is foolish regardless of the economic condition as a whole. In my opinion anyway.

I hope that your mother recovers physically, financially and I’m sure emotionally (must be hard to stress so much about money because you got sick). I agree some people have no choice and will participate in that the recession will make their financial situation far worse, others will be unaffected and some will receive a boon from the recession (pawn brokers, repo guys, etc.) So all you can do is try to prepare for life and if you are lucky you kept both your financial and friends/family situations strong. If so you have two cushions and you should survive most problems and then be prepared to repay your emergency fund and your friends/family.