The Economic Perspective: “Planning for Bad Times”

Mary: This is Mary Walden with economist MW, welcoming you to the economic
perspective. Today’s program looks at planning for bad times. Mike, we’ve certainly
been living in bad times during the last year. Most experts didn’t predict the onset of the
pandemic and recession, so they were hard to plan for. Does that mean we shouldn’t try?
Mike: Summary Answer
a. That’s the nature of bad times – usually unpredictable
b. Makes it even more important to plan for them
c. Experts say most households need emergency saving of at least 6 months to
cover necessary expenditures
d. Pandemic shows that may be low
e. But in good times, had to save – because means giving up buying things that
make us happy now
f. One approach – have an automatic withdrawal from your paycheck that goes
into savings before you even receive the money
g. Forced savings – and one day will be glad you did
h. I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension
program from the Department of Agricultural and Resource Economics