How you will be affected by the Economic Recession in 2020? Table of Contents
Recession is coming. How do we protect ourselves?
Trade wars, political turmoil, and economic slowdown is there anyone who can save us?
What do we do? Where to go? And how to get away from the recession?
An Economic Recession
It is a temporary economic downturn trade and industrial activities and economic indicators decline in two consecutive quarters (six consecutive months).
The result is, lower consumer spending, business losses are increased, more layoffs or furloughs, and higher rates of unemployment.
Meanwhile, unemployed workers reduce spending and rely on loans and credit cards, causing greater business losses.
How to prepare for a recession?
1. Stay away from your money and stash it
During a recession, budgets get very tight and most consumers suffer, and savings are minimal or nonexistent so you should:
- Open an interest-bearing account as a current account or a savings account with attractive rates.
- Set up an automatic transfer or direct deposit.
- Make sure that you don’t have easy access to these accounts and can’t reach them quickly if you feel tempted to spend the available cash.
- This extra cash will be a lifeline when the economy is shaking.
Direct deposit is a payment option where your funds are electronically transferred to your checking or savings account, without the need for paper checks or visiting the bank.
2. Invest in safety-net expense
- Because people stay at home and don’t drive during a recession to keep their vehicles longer, hardware and car breakdowns are inevitable. Safety-net expenses include: home warranties, bills, cell phone insurance and car repair service contracts.
- Households often overlook or reduce safety-net expenses when budgets are cut and cash is low, Which is a mistake.
- Risk reduction measures and safety-net expenses are designed to protect you and your family in times of crisis from massive unplanned repair expenses.
- So maintaining this net from collapsing will save hundreds to thousands of dollars on expensive significant repairs or replacements.
- Invest in affordable month-to-month or pay-as-you-go safety-net expenses to protect your budget.
3. Say goodbye to luxury expenses
Unfortunately, my dear reader, this is the time to say goodbye to the monthly massages, weekly hangouts, pricey self-care traditions and eating out daily.
These luxuries and expensive expenses will unavoidably affect your bank account balance.
So reduce luxury expenses to free up extra cash for the emergency and recession.
4. Focus on networking
Your social network is the key to survive a recession or if you lose your job unexpectedly.
The most powerful way to prepare for a recession is to make networking a habit, not an afterthought.
When people lose their jobs, they quickly connect with their networks to find a job again.
Remember, smart people don’t wail for an emergency call so they can start building their network or creating networking opportunities.
And don’t forget to update your resume and cover letter.
Recessions are indeed painful times for any person, family, or firm.
But With a few simple steps, things get better and losses are more limited.
So don’t underestimate any advice or hide any information that can save you or others.
Justt keep your money safe and you will survive.
Recession isn’t the end of the world.