Adversity can provide a catalyst to grow stronger, and economic downturns offer unique opportunities for financial advancement. If you are one of those experiencing financial difficulties due to the downturn in the economy, apply these recommendations to survive a recession and bounce back better than ever.
Increasing Your Income
Pick up jobs that grow in demand during a slump to boost your income. People usually decide to hold onto items instead of purchasing replacements when there is a recession. Skilled tradespeople who repair and maintain appliances, homes, and vehicles can do very well as a result. Building materials may decrease in cost, making the business more profitable. You may find clientele easier by purchasing a company with an established name or franchising but read the fine print to calculate if you’re better off building a new side hustle into a business.
Your income effectively goes up when you save money. Therefore, look for opportunities around the house to leave more cash in your wallet. For instance, a fireplace can warm a home for much less than your heating and cooling system. Hardwoods like elm, maple, birch, and beech are better for burning than softwoods. Using the former type of wood instead of the latter will save you some cash in the long run. There is probably firewood near you for sale, and your wood delivery expenses are based on the wood purchased, home location, current season, and type of cut.
Planning for Unemployment or Underemployment
Don’t allow the loss of a job or reduced hours to take you by surprise. Instead of fretting over cuts, build an emergency fund during a boom to float you through a transition. Review your budget to understand where you can tighten your belt. The envelope system can keep you focused if you have difficulty monitoring where your money goes. In addition, financial apps can gamify the saving process to motivate good habits.
Learn what unemployment benefits are available to you and practice bargaining skills to negotiate a reasonable severance package should push come to shove. Stay alert to educational opportunities that make you a more valuable candidate for job openings. Plan to use the time if you’re laid off to enhance your capabilities with professional development courses.
Decreasing Your Anxiety
Pessimism can push you into inactivity and weaken your resilience. To avoid this situation, you can be an optimist while remaining realistic. Do this by feeding your mind on inspirational material regularly from books, videos, and articles. Look for the experiences of people who turned the circumstances of a recession into a road map to wealth and model the mindsets of successful individuals.
Lowering the Right Debts
Using debt appropriately can be a financial tool, but if you fall into a debt spiral, a recession can cripple you. Assess your liabilities and pay off the most expensive debts first. A balance transfer can reduce the high interest on credit cards, as can a consolidation loan.
While doing this, keep your credit score high and prepare for when interest rates dip to stimulate more consumer activity. The bottom of a market swing is when you can buy low in stocks and significant purchases to come out ahead.
Review your purchases of household staples to find additional savings. A cheaper deal doesn’t always mean a better deal, though. Check reviews to ensure the products you’re considering are worth the money and have staying power. For example, family-size tissues and soap could save you more than purchasing dollar store varieties. By the way, surveys show that most people underestimate the cost of pet care. As you shop for your fur babies, sign up for newsletters and join clubs to get deals and discover where you can save by buying repeat purchases in bulk.