When can you afford to be wrong?

Which decisions can you make with confidence that will offer you the same penalty-free "do over" option, which the credit crisis proved is available to governments, lenders, corporations and the professionals they employ? Which of your committed choices carry the same "reserve the right to revise" qualifier that economists and forecasters now include in their proclamations of our future, so they can over-ride unpredictable factors and remain right whatever happens next?

Did the world economic meltdown teach you that following the advice of pundits and experts and trusting others with your well-being is dangerous? Did it finally become clear to you that you have to live with the consequences of decisions made by you and your advisors without the benefit of "do overs" and the penalty-free right to revise?

If you don't consciously re-evaluate and redefine your approach to real estate ownership, money and the lack of it, you may find yourself unable to make financial, career and lifestyle choices you can commit to and protect. Second-guessing yourself and waffling on decisions may be a devastating by-product of these unnerving times. Consciously take control of your life, your career, your business and your real estate, and you'll build-in the flexibility and resilience you need to weather any economic storm.

Which new habits should you cultivate, in business and in life, to ensure you are not caught financially off guard again?

• What knowledge do you need to acquire, and which advisors to seek out, so you aren't subjected to yet another financial hit during the next financial downturn? Whatever stage of life you're at now, goal setting and strategizing are the tools which will strengthen your position and increase resourcefulness. Today's decades-long extended living, which I call unretirement, means life continues as an active campaign to preserve chosen standards of living for its entirety, regardless of economic uncertainty.

• The "save more, spend less" mantra, which distills down to not spending more than you have, permeates post-meltdown media and would seem to be the best lesson to learn. However, most of us knew this before, but ignored it. Some called this fact "common sense," but it proved to be uncommon. If you did not learn this financial lesson before, why not? Lack of goal setting, which often includes budgeting, is usually at the heart of actions that ignore this financial basic.

• Ignorance is very expensive. The unexpectedly fragile state of the world banking system arose in part from the fact that no one knew. No one knew the extent of the interdependence, the degree of financial indebtedness and the firestorm immediacy of electronic communication. No one knew who was in charge, because no one was. What you don't know and understand mark your greatest vulnerability. Attack your ignorance on all levels to build security.

• What happens to an advisor who does not keep you informed or specifically protects your investments? Did you hear in a timely manner from those you pay, through fees or commissions, to manage your assets? What will you do to ensure you're definitely on the "call first" list and involved in anticipation strategies when the first rumblings of trouble begin like they did in 2005 and on through 2008? How many times do you need to learn that you are your own best financial advisor? Have you grasped that control over the future demands control in the present?

• Governments, pundits and media tend to speak or write in generalities, just as the broad audience of this website and my column forces us to do. You live with a set of specifics that only you fully appreciate. Canadians are reassured by governments and pundits that the country won't see dramatic real estate price decreases or waves of mortgage defaults common in other credit-crunched countries. These generalities will not be true everywhere. They ignore specific circumstances in communities and neighbourhoods in this diverse country where shift reductions and plant closings raise local unemployment. Accept the fact that all economic and real estate projections and statements will have different impact locally.

• Canadian banks rack up world-class profits each year and will be fighting hard to preserve that profit level. Interest rate decreases may assist in interbank credit transactions, but don't expect your mortgage or line of credit to automatically benefit. Will consumers receive relief from crippling credit card charges and interest rates levied by the same financial institutions that taxpayers' money is now baling out? Probably not, unless consumers loudly and persistently suggest this to election-sensitized politicians.

• October 15 marked the end of "easy money" for home buyers according to Canada Mortgage and Housing Corporation (CMHC). In a move that smacked of paternal censure of consumers as if they had taken advantage of lenders, the federal agency which supports the housing industry, put an end to 40-year amortization periods and no-down payment mortgages. It's back to minimum 5 percent down and 25 year amortization periods. In fact, removal of 40-year amortization, which dramatically lowers monthly payments, may have dealt another credit-crunch blow to small businesses, which drive local employment. Home-based business, which offer considerable tax advantages as well as obvious income benefits, may have lost a financial option before many owners realized it was there.

• November 22 is National Housing Day. On October 16, CMHC held the first auction in a series to purchase up to C$25 billion in insured mortgage pools "to maintain the availability of longer-term credit." How has the international credit crunch affected budgets from this federal agency and governments to improve affordable housing choices in communities across the country?

If you are not happy with your current situation, the important question is not "How did I get in this mess?" You'll benefit most from asking, "How can I be sure I won't be in a mess like this again?" What goes down will go up, but it will probably go down again. Isn't that a real estate market basic?

Thinking differently about what you do and how you decide may be long over due.

Published: October 21, 2008

Use of this article without permission is a violation of federal copyright laws.

Strategist and Futurist is The Catalyst -- intent on "Helping The Best Get Better." An internationally-recognized "new retirement" authority, PJ's research, writing and speaking programs focus on decisions Baby Boomers face to achieve a successful future. Author of 6 books, PJ knows that, since home is headquarters for the "new retirement," professionals and consumers need relevant knowledge and insights, along with solid decision-making skills, to protect and enhance this private oasis. As The Catalyst, PJ provides strategic communication, client appreciation and advanced education services to the financial, tourism, lifestyle and service sectors -- and the clients they serve. A frequently quoted financial and business commentator, PJ is a thought-provoking strategic speaker who offers practical, real-life suggestions on leaving "the box" behind and embracing Forward Thinking -- a talent she regularly demonstrates in this column. For more, visit TheCatalyst.com.