Recession Watch: What to do when you're low on cash

When you want tips on what to do when you're low on cash, talk to a freelance writer. We're all very well-adjusted to the feast-or-famine lifestyle, thank you very much. Some months we're out of debt and investing our extra. Other months, we're digging through coat pockets for milk money.

Tragically, there's a lot more famine than feast most years. So we know how to live close to the bone. Below I outline a few trade secrets developed over the many years I've spent living on the edge of financial disaster. These might sound pathetic, but hey. They work. And I've never once been late with the rent.

Stash your Cash -- In feast times, plan for famine. In other words, stash your cash. When times are fat, always tuck away cash reserves, maybe a couple of hundred, in twenties, for that rainy day. When you have NO MORE money at all, this stash will buy your kids' milk and you a gallon of gasoline so you can drive to that temp job.

Coin of the realm -- Remember what your mom told you about keeping change? It's true. It adds up quickly. If you deal only with paper money and jar all your change, you'll have a surprise stash of cash when times get lean. You can easily transfer your 50 pounds of coins to paper money if you don't like the dirty looks the store clerks give you when you pay for groceries in quarters...

Cut the fat -- Stop spending. Pay just what you have to in order to keep a roof over your head and the heat on until you can find another job or the universe smiles upon you once again. Cut out every single luxury you think is a necessity, and by this I mean, no more coffee that isn't made at home. No more wine, no more cheese, no more iTunes purchase, or lunches out. It's a grim life, but when you're broke, you don't have a whole lot of choice. Start cutting coupons, buy only on sale, and get on an intimate basis with your local library.

Clean House -- Look around your home and repeat this mantra: One man's junk is another man's treasure. How much money does it cost to put a garage sale ad on Craigslist? Nothing. You could have many hundreds of dollars in your broke little hand by Sunday afternoon.

By the book -- Some people make a tidy little extra every month by selling back books to used book stores. Some entrepreneurial types take that mindset and start selling back their books to I know one man who makes a very good living finding rare and first-print books for pennies at garage and estate sales, then flipping them to book collectors on the internet. This takes time and talent, of course, but what a cool idea!

Babysit -- What parent in their right mind is going to say no to an offer to babysit Saturday night? Going rate is $10 an hour these days. They've got jobs and you've got time. It's a match made in heaven. And chances are they'll hit you up for a regular gig....hence, regular cash.

Mad Skills -- Got a skill? Teach a class. Teach people how to ski, how to pay their taxes, how to change a tire. Surely there's something you know how to do that other people will pay to learn. You know how many people want to be writers? Just about every lawyer I know. I know not a few hard up writers conducting lucrative writing workshops and seminars aimed at those with deep pockets. You'd be shocked at how many people will spend $600 for a six-week seminar on how to polish your script, how to write a query letter, how to....hey, make something up.

Roommates -- Maybe the universe gifted you with a house somewhere along the line. Maybe you bought a long time ago when houses weren't obscene. Maybe you don't live in California. In other words, perhaps you have a house with an extra room that you can rent out to someone else. Someone willing to pay you cash money. Where I live, single rooms rent for $600. That's a lotta dosh when you're otherwise low on cash. Come to think of it, isn't this privilege the principal behind becoming a land-owner?

Park it - No extra room to rent in your house? What about renting your garage? People need garage space to park their extra cars or park their excess stuff. Who cares what they need it for? It's an extra $50-$100 a month (again, depending on where you live).

Need some more ideas of how to live low on the totem pole? Check out 101 ways to save money. And more ideas on how to save and get out of debt are here, so when those rainy days do arrive (er, they're here already), you're not in such financial straits that you have to resort to couch diving.

Let's here some of your tips for how to handle those low-cash-flow months.

This post was written as part of a series offering consumers advice on what to do in a recession.

Read Full Story