With a global recession in sight, it is really vital to know how to make yourself recession proof
One of the major topics in the news today is the poor state of the economy, following the mortgage crisis and the bankruptcy of many financial institutions. The word “recession” or even “depression” is frequently mentioned. While recessions are not the best time of your life, there is nothing so worrying about them and if you don’t panic, but take the appropriate measures instead, you will survive not only this recession but all the recessions in the decades to come.
What Is a Recession?
Recessions are tough times but in a sense they can’t be avoided because they are a part of the normal economic cycle. Once in 4-5 or in the best case – in 7-8 years there is a recession and then economic activity in general drops dramatically. Unless you are the president of a global superpower, you personally can’t make a lot in order to prevent a recession but you can make a lot to make your life easier during a recession or even to make it recession proof.
How a Recession Will Affect You?
Not everybody is affected by recessions in the same way. How hard the recession will affect you depends on many factors and one of the most important is your industry. Industries such as medical, army, public administration, or education are generally more recession proof than industries such as engineering, banking, sales, or entertainment. But even if you are in a recession proof business, this does not mean that everything will be OK for you personally.
One of the worst things that can happen to you during a recession is to lose your job. Generally speaking, losing your job is not a tragedy but during a recession it will be harder to find another job, especially if your branch of industry is suffering and you have a lot of demands.
Another possible negative effect of recession you might feel is that your stocks and other investment might lose their value. But if you haven’t invested in such instruments, then you are already recession proof.
Tips to Make It through the Recession
The most important step to surviving the recession is to become recession proof. Here are some tips (you can follow them even in times of economic boom) to help you become more recession proof:
Stock durable goods. Now, when you have the money, get durable goods – both foods and non-foods. If you buy them in bulk or use discount coupons, stocking durable goods could be quite of a bargain.
Get out of debt. Getting out of debt is another vital step. Debt is a problem even when you have a stable income but when you lose your job because of the recession, this can simply bury you. Start paying the debts with the highest interest first.
Save some money. Money is never enough but try to save some of it – let’s say $5,000 or so. Try to save the money you will need to live on for at least 2-3 months. This might look a bit extreme but when you don’t have the survival means you need, you will be pressed to start the first job you are offered no matter if it is suitable for you or not.
Cut your expenses. One of the ways to save money is to cut your expenses. There are many ways to save on food, clothes, transportation, utilities, entertainment and almost anything you can think of and still have a decent standard of living.
Improve your professional skills. Improving your professional skills will help you in the job hunt. This is especially important in times of recession, when jobs are not abundant and finding a good job is like winning the lottery.
Get a side job/income. Even if you don’t lose your job (and respectively your major source of income), you can insure yourself against financial trouble by securing an additional income in the form of a second job, renting a room, joining an affiliate program, etc.
There are many more ways to make it through a recession and the tips in this article on recession are by no means an exhaustive list but if you follow them, this will make your life much easier and above all – recession proof!
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