Jun 17, 2009 5:17 pm US/Eastern
Experts Offer New Rules For Saving Money
NEW YORK (CBS) ―
While the economic recession carries on, it's taking many much longer than they anticipate finding work in this tough job market.
"There are jobs out there, but how much competition I have I'm not sure so that's the problem," says Donna Moshe of the Upper East Side.
Meanwhile, unemployment continues to plague many Americans. In May, unemployment rates rose to 9.4 percent, according to the U.S. Bureau of Labor Statistics.
"The last time I worked was in November of 2008 and I've been unemployed since," Debra Robles tells CBS 2.
In past economic downturns it might have been enough to cut down on eating out and unlimited texting, but now experts have a new rule to make money last longer:
"If it doesn't keep a roof over your head, if it doesn't feed you or keep you insured, you can probably cut back on it," says Janet Siroto, Good Housekeeping's executive editor.
Experts immediately turn to two easy cuts: replace your home phone with your cell phone, and drop your cable package. There are Web sites that stream thousands of TV shows and movies for free.
Dylan Ross, a financial planner at Swan Financial Planning, says you need to go to extreme measures if you want to use your money as efficiently as possible.
"You really need to go into almost a financial hibernation to stretch your money out for as long as it will possibly last," Ross says.
Another important rule is to save your cash as a cushion. Some companies offer zero percent interest cards, but the cards must be used responsibly.
"Finding a credit card with zero percent interest for as long a period as possible will help you should an emergency happen, a pipe bursts in your basement, or even if you're having a hard time just week to week," Siroto says.
But when the introductory rate runs out, you could be stuck paying a high interest on everything you buy.
If you've been laid off, you can sign up for COBRA assistance. Thanks to the February stimulus passage, you only have to pay 35 percent of the full cost and the government will pick up the rest of the monthly payment, which is more than $1,000.
To qualify for the COBRA assistance, you must have been laid off between Sept. 1, 2008 and the end of 2009.
For more information on COBRA, click here.
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