Top 10 Ways to Prepare for a Recession
Okay, it's pretty obvious that the United States of America is headed for a recession. While I don't want to cause this list to become a slugfest between Biden voters and Trump voters, it's a pretty good idea for a list, so I'm gonna give it all I got as far as quality, which means lots of research and details. Without further ado, here are ten ways to prepare for a recession.
It's an excellent idea to have an emergency budget already established in case you lose your job. This will be of great assistance and ensure you do not need to make extra decisions while stressed from getting fired.
Plan how you will minimize your everyday spending under normal circumstances. Consider what areas of your budget you can do without and where you can move your money around. Doing this will reduce stress and allow you to pay more attention to your mental health, which may not be the best given the stress and anxiety.
Distinguishing your needs from your wants is very important when planning for hard times economically. Knee-deep in a recession, you probably won't have money to spare for things you want, like a long-awaited video game or a manicure, since money, inventory, and employment all have the potential to be scarce.
By separating things you want from things you need, you prioritize and hopefully become more considerate given the dire circumstances. Look for things like food and gasoline before trying to collect CDs or buy a new cell phone. This is called minimalism, and it ensures that your inventory has necessities outweighing desires by a large margin.
Not a bad idea to do even without a recession looming, but working on boosting your credit score to brace yourself for a recession is a must. When times of trouble come, you will be able to apply for a new credit card to stay stable in a sinking economy.
If you use a credit card to pay for various needs, make sure that you can eventually, if not immediately, pay the minimum amount of credit card debt and other required payments like rent. Bad credit scores can make it much harder to borrow years after you get them.
Even if you still have a job, spending money as if you are on the unemployment line eliminates discretionary spending and makes it so you can only focus on necessities. Cutting down on non-essentials is a great way to preserve money for urgent needs.
Changing your perspective to "I don't have a job anymore. I need to make sure I save as much money as possible," might give you a false sense of desperation, but it might also keep as much money in your wallet as possible. Hard times may be lurking around the corner, so it's a good idea to limit your spending to brace for them.
If you're considering stopping your 401k contributions to create an emergency fund, another approach is to invest in a Roth IRA, or an individual retirement account. Roth IRAs have somewhat flexible withdrawal limits for people who are 59 and a half or older. For instance, you can take out investments at any time without having to pay taxes or a ten percent penalty.
It's still very important to invest in your employer's match for your 401k, but making extra investments in a Roth IRA gives you more flexibility.
You'd have to be very lucky to book a checkup before a recession hits, but it never hurts to try. If you schedule to see the doctor before a recession, you will have the luxury of being able to pay for medical bills while you still have a job.
You will also get to see your healthcare provider before hard times loom. While health is still on your mind, make sure you refill various prescription drugs while pharmacies are still open, and you can get your prescription refills as needed.
If you use a flexible healthcare spending account, when a recession is looming is a good time to learn how long it covers you for, if there ever is a good time.
It's a pretty good idea to buy used products without the threat of a recession, but a recession amplifies the reasons why. Brand-new products are more expensive than used shirts, cars, and so on. Given the likelihood that you'll lose your job shortly after a recession hits, you might not necessarily find things scarce, but the odds are against you staying employed.
Without a job, you no longer have the luxury of buying a brand new Mercedes Benz if you're part of the middle class. It is relatively easy to find the products you are looking for, and their quality might be almost the same as when they were new, but at much more reasonable prices. Better prices and likely still good quality make this a smart choice.
You might be asking what cleaning your house has to do with preparing for a recession. Usually, it has nothing to do with preparing for a recession, but if you start looking for ways to rid your home of clutter, it not only looks good, but also provides a decent source of money for you.
By getting rid of clothes, video games, toys, and other things you haven't touched in years, you can lessen the blow when a recession hits. The recipient of your junk might need it way more than you do, combining kindness with a decent source of money. It will possibly be more than just you and your family who benefit.
Well, yes, that's actually a decent approach to prepping for a recession. It's all about getting money safely in your wallet in advance, really. Cash is king and all.
As the economy crashes during a recession, if there's one thing that can be considered a positive, it's that your power as a customer goes up tremendously. The worse the economy gets, the more likely you are to negotiate for a better deal for whatever you might be buying. Be bold and ask for a lower price or bonuses for whatever the product may be.
You may not be a great negotiator off the cuff, as it takes business know-how and experience to do good negotiations. However, most stores you are trying to negotiate with will be willing to find a middle ground more often than not. Businesses will try to raise their prices in desperate times, but you can ask for a lower price just as much.
The Newcomers
If you're switching to a job in which you have much less credibility than in your current job, you're more likely to get fired in the new job.
Saving money when buying from Amazon and other online sources becomes much easier when you install apps that search for coupons for you. Apps like Groupon and PayPal are critically acclaimed for economic assistance, and many find the deals they get from these apps to be great.
Considering a recession, the App Store or the Google Play Store can be lifesaving. Groupon is the most popular example, with over 100 million users, and the vast majority give it a five-star rating for good deals and better prices.
Other apps, like CouponCabinet and RetailMeNot, provide the same concept. They search the Internet whenever you're about to finish making an online purchase and look for any available legal coupon codes. People already think these apps are wonderful, but in a recession, or perhaps a little bit before one, they would feel ten times better, if not more, considering the circumstances.