Released: October 26, 2008

Stay out of debt in rollercoaster economy

Source: Jessica L. Anderson and Kimberly Lankford, Kiplinger's [Washington Post] (Free Registration)

In the face of an unpredictable economy, can you withstand a fiscal crisis? Here are four steps to take to protect your household from falling into debt during low financial times.

· Step 1: Prepare for the worst-case scenario.

Come up with a plan to live on less. You never know when you might lose your job or end up with unexpected bills. June Walbert, a financial planner with USAA, recommends taking out a mortgage that you can afford to pay on only one income, even if both spouses work.

· Step 2: Keep an emergency fund.

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