Starting Over to Recover Savings Losses

Early in our marriage my husband and I began taking care of his elderly mother (he was a very late baby) and her two brothers. This started slowly because we were putting each other through school and trying to start our careers so money was tight. Not an uncommon situation as many other young couples know very well. His family was of the generation when Mother stayed home to care for her family, there was no retirement plan for day workers, no retirement "planning" as we have now, and because the uncles's working years ended in the 70s, not a very large Social Security check. Basically, they survived by living together and pooling resources. We helped where we could with transportation, house repairs, extra food and utility money when we could. The up side was that for a number of years we were able to help them stay together and stay in their home untill the uncles passed away and we brought his mother into our home. The down side was that we used all of our resources to keep them going and were not able to start saving for ourselves until about 10 years ago, beyond our employer-sponsored program. The dot.com bust in the late 90s wiped out most of that, so we started saving again but in broader areas. Yes, the loss of our retirement savings spooked us a lot. We decided to only invest/save in safe vehicles after that point. While we stayed with our employer-sponsored plan (matching funds is hard to pass up), we diversified with a Roth IRA purchased through our insurance agent that did not invest in the market but instead relies on interest accrual. This may not have the potential for large gains, but the principal and interest is completely safe from future downturns. We also decided to purchase certificates of deposit through our credit union with extra funds rather than reinvest in the market funds we had before. We have been very glad we made these decisions, especially looking back to the most recent market crashes of this past year, when once again our employer-sponsored program was totally wiped out.

My point here is that starting over is tough and I truly emphathize with so many of you who are struggling just as we are. Having our retirement savings wiped out not once but twice is not fun, but it hasn't changed the fact that we all need to save to care for ourselves. What has worked for us is to make every effort to live under our means. Some weeks that means we only put $10 in our savings accounts, but we never miss putting in something. While we are letting the funds we already have in the market ride in the hope that the recovery cycle will come sooner than later, we are putting new savings in accounts that protect the principle and have very little to no risk. Clipping coupons helps, as does re-evaluating what we pay for all services from TV to phone to car repairs. Driving my paid for car another year or two beats starting up a new car loan. We barter unashamedly; I am a fair carpenter, my neighbor has car repair skills, and still another neighbor is a whiz with her sewing machine, so we trade services a lot with obvious rewards. The more self-reliant I can be the more secure I feel, so I am willing to learn how to do just about anything; and anything I do myself instead of paying someone else to do translates into additional deposits to savings. The hardest thing is taking one day at a time and trying not to be discouraged when I see how slowly the totals are going up on our accounts. The totals are going up, however, so I am hopeful again.