If you are wondering how this may affect you personally, you should begin by taking a look at your personal finances. You may find that it is a little harder to qualify for a mortgage. The numbers of subprime mortgages are going to decrease dramatically. You will need to have a sufficient income and decent credit history to qualify for your loan. You should also plan on having a good down payment saved up for your home.
You should also take a look at your debt load. It is a good idea to reduce the amount of debt that you have. Many people are looking at all types of credit and feel that the crisis might spread to the credit card market as well. You can protect yourself by living within your means and focusing on getting out of debt.
Your savings and investing strategy should remain the same. You should continue to save and invest your money. The FDIC should be able to handle any other bank collapses. The stock market will recover eventually and your money will continue to grow. Remember to spread your investments so that you do not have them all in one company. An easy way to do this is to invest in Mutual Funds.
You may also need to build up your emergency fund, because it can become more difficult to find a job during a recession. Although the economy is not currently in recession, signs indicate that we may be heading towards one. Usually a recessions leads to layoffs, which in turn leads to a bigger recession, which then leads to more layoffs. It is a vicious cycle. Do what you can to prepare yourself to remain competitive in the job market.
