For some, it starts with a simple pencil and paper. You need to create an accurate record of all expenditures in order for you to know where the money is going and what it can be put toward. This includes everything from food to gas to bills to clothing to even the amount of money you spend treating yourself. Once you have an accurate picture of your expenses, you can start shaving away at the expenses you can live without and this is what making a budget is all about. This isn’t of course to say that you can’t set aside any money to enjoy yourself – you just need to be responsible. You may find, with some of the money that you’ve freed up, that you can pay off some of your debt or even look into debt counseling services, and once you get all outstanding debts under control your budget will suddenly look a whole lot nicer.

Wall Street would lead you to believe that you have to be constantly trading in and out of stocks. They would also like to make you feel as though you have to follow all of the latest news and have high quality technology. This is just not the case, and you shouldn’t fall for this trap.

The key to investing in any market is diversification. There are four main asset classes that many investors diversify between and they are: bonds, large cap stock, small/mid cap stock, and international stock.

Bonds are the stability of a portfolio, and act as a cushion when there are swings in the market. Large cap stocks are large companies with their headquarters in the United States. Small cap stocks are simply small companies in the United States. Internationl stocks are companies that have their headquarters outside the United States.

One of the main determining factors of how much to put into the bond category and how much to put into stocks is the age of a person as well as the time frame as to when they will be needing the money invested. The longer the time frame and younger the person the more money they could have in stocks and stock mutual funds as they have a longer time to have the swings in the market even out to an average return. Another factor is how risk adverse an investor is. If someone does not feel comfortable investing in stocks, then simply invest in stock mutual funds which are simply many stocks within one investment.

Just because some consider the market a bear market does not mean an investor should change investment styles. Timing the market is very had, and many professionals do not complete it successfully. Remember you need to be right when you sell an investment and right again when you buy its replacement. Timing the market is hard to do, and a diversified portfolio will help investors weather the storm in a bearish market.

It should tamper off within the next few weeks. This is not the first market downturn the US has seen, and it will not be the last. So, in the mean time, investors have to be watchful and mindful of their current investments, wait off some time before buying into new investments, and just let the market taper off. It will get better eventually, and investors need to wait off on making a big purchase or a big sale, until the market does come back up, in order to make a large profit, or to avoid a big loss.

First, sit down with a pen and paper or a laptop. List all of your absolutely necessary monthly expenses, such as your mortgage, utilities and food. You should have enough money put aside in a money market or savings account to pay these expenses for six months. If you don-t, you need to start saving immediately toward that goal. Even if it-s only a few dollars per paycheck, start saving.

Then make a second list that includes all of the other expenses your family has. Take a good look at the list. Can you make do with less? Can you get by with one car less? Can the family go camping at a state park instead of spending a week at an expensive resort? Can you increase the deductibles on your insurance so that your premiums are less? Look for ways to cut or eliminate expenses.

Finally, you need to invest for the future. Recessions pass. We all need to invest so that we can handle education costs for our children and retirement costs for ourselves.