Your Mid-May Financial Makeover
The signs are getting stronger and you can already feel the effects: We're definitely seeing a 2nd Quarter Slow-Down.
Why is it happening, How long will it last and What can we do about it?
It's happening because the 4th quarter consumer spending that re-energized the U-S Economy last Holiday Season left us with a lot of bills coming due at the very same time Unemployment is still a major problem, New Job Growth stalled and Gas prices started rising.
With less income, consumers simply re-focused their budgets to pay their most-important bills and keep a roof over their head. Most extra spending was stopped.
Miami Driver Gloria Jackson says " It's taking from one budget and putting it all into gas for the car. Prices are beating us down a little bit".
Doral Driver John Bryant agrees that High Gas prices have hurt his budget and adds " Seems like everything's going up, higher gas is effecting food, transportation, shipping, everything I think".
But it's not just Gas prices that may be pulling back the Nation's Economic Recovery.
A recent Federal Reserve report found Industrial Production in April was basically stagnant from the month before. But the U-S Auto Industry suffered an 8.9% drop due to parts shortages following Japan's earthquake.
And there are more signs the troubled Housing Industry's still facing serious problems. The US Commerce Department just reported New Housing Starts in April were down 10.6% from the previous month.
Around South Florida, the inventory of unsold residential properties is expected to get even worse once Foreclosure Hearings start again after being temporarily halted following "Paperwork Problems" from improperly signed legal documents.
And until all the remaining distressed properties get sold off, new residential development and construction will remain stalled. It's a simple case of supply and demand: Until current Homes and Condos on the market are sold, there will be little demand for any new ones.
What does it all mean for Local Families?
As the end of the school year approaches, thoughts will be turning to South Florida's Summer. That includes preparing for Hurricane Season and planning Family Vacations.
That's still a few weeks off in the future, so now a perfect time for your "Pre-Summer Financial Makeover"
Up first? figure out your "Balance Sheet" detailing Expenses and Estimated Earnings.
Write down your Overall Debt and double check the Interest Rates on all your loans.
Where at all possible, try to re-negotiate Credit Cards and other Loans to lower Interest Rates. It may also be a great time to start using Cash as much as possible for many purchases. That way you'll avoid getting hit with Interest Charges on your Credit Cards and you can also ask for Cash Discounts and "Negotiate Prices" for even better bargains.
It's a perfect time to start researching all the Vacation Offers we're starting to see. You can also set up a Summer Travel Budget so you don't overspend when Vacation Time comes around.
It's also a good time to consider starting a so-called "Christmas Club Account" at your Bank or Credit Union to start saving for all your Holiday Shopping at the end of the year.
Spend a little time right now budgeting for the Summer and Fall and it'll help guarantee your finances go a little further later in the year.
