5 Ways to Survive the Dollar's Dive

While this may encourage you to travel within the U.S., that alternative still won't be cheap. Increasing oil prices will mean that travel expenses will be more costly than usual, meaning that your dollars will buy less in travel than they did before.

What you can do: If you want to go to a foreign country, look at Central and South America, rather than Europe, Canada or Asia. If you do go to Europe, plan ahead and buy euros in advance, if you expect the currency to further advance against the dollar. In the U.S., plan a more local vacation that won't entail a lot of fuel-burning driving or flights.

5. Debt

If you currently have debt, the falling dollar could come back to haunt your finances in a big way. While there are a number of reasons the dollar is falling, one main reason is that Americans import a lot more products than they sell abroad. The result is that the U.S. must borrow money to close the trade deficit.

As long as other countries are willing to buy our debt, everything is fine. But as the dollar loses value, it makes less sense for countries to invest in our debt when interest rates are so low.

The result is that the U.S. is forced to raise interest rates in order to attract investors to buy the debt, which could result in inflation and much higher interest rates for Americans. Interest rates may even eventually rise to double digits. That means that if you have any credit card debt, you are going to see your interest rates rise. If you have an adjustable mortgage, you will see your monthly house payment rise. In addition, if you need to borrow money for a car or house, it's going to cost you a lot more.

What you can do: Pay down as much of your variable interest rate debt as you can. Avoid adding to credit card debt.

Now that you understand how the falling dollar can affect your finances, you are in position to take the necessary steps to help ease the pain. These changes are already beginning to take place and will likely continue to increase, so the time to take action to ensure your personal finances and budget stay on course is now.