By Joseph Palumbo III
My dad once told me a bad experience turns into a good thing if something is learned from that bad experience. Case in point: What have we learned from the recession as we crawl out of it?
First, be wary of your debt. Our homes are not going to keep going up in price. We have to pay back the money we borrowed and live within our means. Going forward getting credit lines, loans and mortgages is going to be harder with more stringent standards in place. If you are looking at a car, for example, and the monthly payment seems like it could be a stretch, do not buy the car. Our homes are not our personal ATMs. You have to pay the money back.
Second, do not trust anyone. This means no investment or job is safe as we all learned from the fall of Lehman Brothers, Bear Stearns, the mortgage industry, etc. The lesson learned here is you must do your own due diligence on what or whom you are investing in. Do not let any name sell you on the premise of investing your money. The smaller banks and investment companies have done better amid the financial turmoil.
Third, the sexier-get-rich-fast type of investment is what you thought when you first heard about it being too good to be true. But the mindset prior to the recession was that money was easier to come by.
We learned bonds held their own — and they are far from a sexy or get-rich-quick investment. Granted there were some land mines, but overall bonds proved to have substantial gold mines that did well.
So How’s Business regarding lessons we learned from the recession? We are in for a mushier-than-usual recovery, but all indicators show the economy is getting its legs back after being dropped for a solid eight-count. Most importantly is you are a better fighter going into the later rounds because the next down may be a knock-out.
Contact Joe Palumbo at 516-297-4034 or jp@c21amhomes.com.
