What would you do if you were in danger of losing your home? If you had to come up with $2,500 right now, could you do it?

That was the situation faced by Angela Logan. Her home was facing foreclosure and she had to come up with $2,500 a month for three months straight to avoid homelessness. Faced with dwindling income and no emergency savings, Angela turned to what she knew best: she baked cakes. At $40 a pop, she figured if she sold 100 cakes she could save her house...and it worked.

There is a lesson to be learned from Angela: desperate times call for desperate measures. What is the talent you could fall back on to earn quick cash if you really, REALLY needed to do it? I faced a similar situation myself about 7 years ago. I had been evicted, my family faced homelessness and I had no money, no savings and no job. On a leap of faith, I took a job halfway across the country in a city and a state I had never been to before. I didn't know anyone, and I didn't have a home waiting for me. I drove cross-country in two days, arrived in town with a couple hundred dollars in my pocket from an unemployment check and moved into a roach-infested apartment in a really crummy area of the city.

I'm much better off these days. In fact, I earn more money now than I ever have at any point in my life. But back then, seven years ago, I did what I had to do. Desperate times called for desperate measures.

About four years ago, my wife had to stop working. She became disabled and very ill. Unfortunately, she earned more money than I did a the time, and we lost all of her income. I was working at my dream job, but it didn't pay well. I certainly couldn't support my family on what I was earning at the time. I walked away from a career I had built over a period of 20 years, and started a new career doing something completely different, but which paid much better. I'm happy in my "new' career, but I did what I had to do. Desperate times called for desperate measures.

We all face hard choices at times. Sometimes we are forced into certain situations, such as when I had to move to a strange city. Other times, we turn to a "big idea" which utilizes our talents and can help generate some much-needed cash, such as baking cakes to pay a mortgage.

If you needed to...really needed to...do you have a "big idea" you could fall back upon, like Angela? Could you move away from friends and family to take a job in an unfamiliar city? The time to ask yourself those questions is before you actually need to consider taking such actions.

As Americans sink deeper into anxiety over the failing economy, some are taking drastic steps. One of the behaviors that some are developing involves stockpiling...food, water, emergency supplies, etc. I'm not talking about stocking an emergency pantry in case there is an actual emergency such as natural disasters or prolonged periods of unemployment. These folks are developing something of a bunker mentality...in much the same way as people who were freaking out over Y2K almost ten years ago.

Don't get me wrong: stocking up for emergencies is not a bad thing. I have recommended it myself, prior to the current economic recession. However, I recommended having a few weeks to a few months worth of food staples on hand in case one were to lose their job and need to put food on their table for their families. The people quoted in a story about hoarders on The Today Show earlier today are stocking enough food for two years or more.

Preparing for bad economic times is not about worrying that the supermarket won't have enough food to sell. They will. Even during the Great Depression, there was plenty of food available for people to purchase. The problem was there were many people who couldn't afford it. We're not at that point yet. In fact, we're not even close. Stocking an emergency pantry is about having some food on hand in case you don't have the money to buy food, usually due to prolonged periods of unemployment. I still recommend having anywhere from eight weeks to six months worth of canned and dry good on hand, just in case.

You don't have to go nuts and spend your kid's college fund to buy this extra food, either. Whenever you see a sale on canned or dry goods (I get mine at Big Lots), buy a few extra cans and stick them away in a basement or closet designated as your emergency pantry. Then, hope you won't ever have to use it, but do use it before it expires. That's where the contents of my emergency pantry went. I stocked up prior to the current recession, but with expiration dates approaching, I finally had to eat the stuff. I'll be stocking up again soon....but nothing like the folks featured on The Today Show.

Besides, that poppy seed cake does not look appetizing at all. Watch the video...you'll see what I mean.

I have worked nearly every day of my life since the age of 18, although I had some part-time jobs before that, so I actually started working when I was 13. All told, I have already worked, in some form or other, 31 years of my life.

When I first started working, I was earning two dollars an hour. My first job was pulling weeds in soybean fields, and after that I worked my way up to picking rocks out of farm fields, and then to shoveling and cleaning out pig pens and chicken coops...a very stinky job.

At the time, I thought two dollars an hour was a lot of money. This was back in the late 1970s, and two dollars went a lot further back then than it does now. I could see a movie at the local cinema for 50 cents, and a can of Coke was only a quarter.

As I got older, I started working a series of jobs which paid me a salary. No matter how many hours a week I worked, I was only going to make a certain amount of money, and it was the same amount every single week. The only way I could earn more money was to either beg the boss for a raise (a demeaning process) or work another job on the side. Since the industry I was working in had notoriously low pay, I usually ended up working another job on the side. That is when I made a crucial discovery.

I was making just as much, if not more money, by working for myself on the side. One of my first "side jobs" was working as a DJ at wedding receptions. I owned my own equipment and earned about $400 for four hours of work, about as much as I was making working all week at my "regular" job. Of course, I had expenses and had to split the money with a partner, but the money was still good.

The first time I was ever laid-off (fired) from my "regular" job, I was unemployed for six months. There were times I didn't know where my family was going to get its next meal. I no longer had my disc jockey equipment, so I couldn't even rely on a "side job". This was during the Recession of 1991. I vowed I would never again rely solely on an employer to give me money. I would always have another way of earning a living, even if I lost my full-time job. I have always had something going "on the side" ever since.

I learned something important working in my previous career. As I pulled into the parking lot of my job in my rust-bucket of a car for which I paid $500 at a used car lot, the boss had a BMW parked in his reserved spot. When I asked the boss for a raise, I would get the response that "times are tough" and the business "couldn't afford to give me a raise", yet he would buy himself a new car each year, and he lived in a large house on the lake. My family couldn't afford to buy a house, much less one on waterfront property. We rented an apartment.

Back then, I was a slow learner when it came to matters of money and personal finance, but the crucial discovery I made after working for years for someone else (who always had more money than me) was this: You'll Never Get Rich Working for Someone Else. Those who own their own businesses gain the most from their employees' labor. Employees earn more money for their employer than they earn for themselves.

You might point out that famous actors and sport personalities make a lot of money, and they do. However, the people they work for still earn more than they do. The celebrities are are the most well-off are those who have an entrepreneurial mindset and have created a "brand" from their name. The rapper P. Diddy is an example of this. He's not just a rapper collecting a paycheck from a record label. He's also a business man, and it's safe to say he is a business man first and foremost. He doesn't rely solely on his recordings to earn his money. He also produces other acts, and he has his own clothing line. Arnold Schwarzenegger is another example. You may think the Governator made all of his money from bodybuilding or acting, but the fact is he earned his business degree from a college in Wisconsin and became a self-made millionaire long before he became a famous bodybuilder. He made his money selling nutritional supplements and making investments in real estate.

Those with an entrepreneureal mindset are the people who make their own money, make more of it, and don't need to rely on an employer to earn a living. Very few people get rich working for a paycheck. Those people usually live paycheck to paycheck. That's what I was doing.

For the record, I am not rich, and I don't own my own business. I do work a regular, full-time job. However, a good chunk of the money I earn is based upon my performance. The more sales I make, the more money I earn. As a result, I approach my job as if my client list were my business. My ability to satisfy them and sell them more product directly affects my bottom line. On top of this, I still have my "side" ventures. A substantial portion of the money I earn comes from the freelance writing I do for my own blogs and for other web sites and blogs. The more I write, the more I earn. I determine how much I do, and when. It may not make me rich, but in a sense I am working for myself on my "side job" and earn more-per-hour/project than I would at my "regular" job.

At some point in time, I may completely work for myself. As I mentioned, I'll never get rich working for a paycheck from someone else. Not everyone can strike out on their own, of course, so there will always be "employers" and "employees", but everyone does have a talent that they own and possess. I believe that everyone has a skill set for which someone else will pay good money. What is yours? Do you have a hobby that would help you produce goods that someone else would buy? Do you possess knowledge, such as web site design, that you could use as the basis for your own business? What is your "brand?" What do you do really well? What would you do if you weren't chained to the "rat race?" Once you determine that, you have taken the first step toward developing a way of making your own money, rather than relying on someone else's salary.

I got some good new recently: I got a pay raise at work. It's not some little cost-of-living pay increase, either. It was a good, respectable multi-thousand-dollar-per-year raise. Considering the current state of the economy, that's pretty darned good. There should be lots of extra cash for saving and investing and living it up (just a little), right?

Well, not exactly. While my pay has recently increased, so have my bills. It's not that my family has created new monthly bills or made any new, large purchases. We certainly haven't. So why doesn't it seem like I'm rolling in the dough?

The bills that have increased are things over which we have no control. My gas and electric bills have increased because the utility services have increased their prices. Gasoline is more expensive. So is food. Also, medical bills and prescriptions seem to have gone up in price, too. These are things we must pay for, and we've been very careful about shopping for the best deals, when available.

Still, my family had a "business meeting" this week. We need to locate areas where we can cut back on expenses. My son's digital video recorder box, which has had for a year and is provided by the cable company, is going to be a casualty. "But it's only $11 per month," he protested. That's true, but that also adds up to $132 per year. Locate 5 or 6 other small expenses like that, and we're saving almost $800 per year. That's money I can apply toward my son's college fund. He seemed to like the sound of that.

Nobody in my home has lost a job. I have been the sole bread-winner for the past three years, and my wife homeschools our son. I make extra money on the side with freelance projects. My earning capacity has actually increased over the past year. However, climbing expenses have whittled away our spending power.

Sometimes, no matter how frugal we are, we still need to adjust our budgets to cope with outside economic forces which are beyond our control, such as climbing prices. We either need to earn more money, which I'm already doing, or cut costs, which is what we will need to do. Last year, I had predicted the economy may start to recover around September or October of this year. There are some early signs that it may be doing just that, but the recovery is going to be very slow, which I also predicted.

Even is you took steps before the recession to try and weather the storm (which we did), it's always a good idea to reassess your finances every couple of months, and identify areas of spending which can be cut eliminated altogether.

The lesson: no budget should be carved in stone. You must be able to react to market forces (what other people are doing that affects your bottom line) and adjust your budget accordingly.

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