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Hug the Monster: 4 Secrets of Surviving the Recession

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In the remote forests of Washington state near the Canadian border, where the air force teaches its aviators to survive in hostile environments, the instructors hate the sunshine. They like it cold, wet and miserable. Rough weather, they say, makes the best pilots and survivors. Adversity is the best teacher. Stripped of every comfort and left to their wits, the pilots are forced to think, adapt, and make a plan.

The same goes for the sinking economy. Survival means adapting quickly and forging new plans. Tough times also create opportunities for those who can change their attitudes and actions. For the past few years, I've explored the secrets of the world's most effective survivors and thrivers while researching and writing The Survivors Club. I met people slammed by life who managed to recover, repair and rebuild. Along the way, I spent some time at the air force's SERE school in Spokane, Washington, where survival specialists teach men and women how to survive, escape, resist and evade in extreme situations.

The basic lessons of survival school apply to all kinds of adversity, like vanishing jobs, foreclosed homes and disappearing 401(k)'s.

1. Situational Awareness. The military acronym is S/A and it means knowing what's going on around you and being able to act. Are you alert to threats to your survival and what's your plan and backup if everything goes to hell? In this tough economy, many of us don't have much S/A. We see the grim economic headlines but don't change our behavior. We refuse to open our 401 (k) mailings because we don't want to see the wreckage. S/A means facing reality. It means recognizing that as many as three million jobs will be lost in the next year - or 340 pink slips every hour. Nearly half of America's households are underfinanced for retirement. The average retirement account has lost a third of its value in the last year; collectively, some $2 trillion in retirement savings have been erased. Sure, many of us may realize this, but the air force guys know there's a big difference between awareness and action. It's not enough to notice your wing is on fire. You need a plan. When it comes to a crisis or emergency, experts say that as many as 80 percent of us freeze and fail to act. We wait for an authority figure to tell us what to do. If you want to survive, you to take action. Quickly.

2. Hug the Monster. It's pretty scary to watch your 401 (k) disappear. Worse is letting your fears run wild. Neuroscientists say that the fear of losing money can activate the same alarms in the brain that go off when we're attacked, unleashing neurochemicals that can wreak havoc on clear-thinking and decision-making. The Air Force calls this "analysis paralysis." What to do? Instructors tell trainees to hug the monster: grab hold of their fears, wrestle with them, and turn them into motivation. Grapple with your fears and they become more familiar to you. Soon, those fears can become your allies and help you survive and thrive.

3. Eat an Elephant One Bite at a Time. Survival is one big ornery animal, and if you try to swallow a 15,000-pound pachyderm in one gulp, two things can happen. You'll either give up or you'll get really bad indigestion. The key is to slow down. Take one small bite. Chew. Swallow. Then take another. Using different language and metaphors, nearly every survivor described the same method: Divide unwieldy challenges into achievable tasks. One goal at a time. One decision at a time. One action at a time. Before you know it, you can make real progress. The military acronym is STOP: Stop, think, observe, plan. Follow those steps in a financial crisis, and soon, you'll be moving deliberately in a better direction.

4. Know Yourself. In the end, experts say, the best survival kit is right between your ears. So use it. It also helps to know your Survivor IQ. How do you behave in a crisis? What are your strengths (and weaknesses)? Working with a team of personality testing experts, I developed the Recession Survival Quiz that gives you a glimpse of your Survivor Type and matches you with top business leaders who share your strengths. The free and fast quiz also points you to some of the best resources and guides on the Web for dealing with unemployment, credit and debt problems, and other financial challenges.