Well, the news is spreading that we are in line for a recession. All the economist say that the signs are very clear that this is inevitable. I found a really great video that explains why we are heading for a recession today. It's a really informative video and the guy explains if very plainly. Click the video below.
The analysis is that this is happening due to Trump's Tariff War with China. However, most of us really don't care why it's happening, people want to know what to do to survive the recession.
Well, you are in luck. Economists say that we have nine (9) months to a year (12 months) to prepare for the inevitable, so if you are reading this right now you are very fortunate. If you take the steps outlined in the post you will bless me over and over because you will be able to ride out Trump's Recession like a seagull floating on a stormy sea - you'll feel the waves but it won't destroy you.
Ready? Here we go.
1. Save as much money as you possibly can.
Save every damn penny (it's gonna count, believe me). This is a time to put your energy in a side job, an extra gig, freelance work and sock away every cent of that extra money you earn. Saving money in an interest-bearing account is optimal, but just saving money in a safe account will put you ahead of 99% of the population.
How much should you save? Well, you are going to want to have a minimum of about two to three months of expenses. Having six months or more is really the goal. It's exceedingly difficult to find a new job during a recession and usually, it will take about six (6) months to find something when the economy is sluggish. The goal is to allow you to survive and not become one of "the homeless" if or when your current primary income disappears (which often happens during recessions).
2. Lower your monthly expenses
Get rid of everything you don't need. And I mean everything you don't need to survive. Get rid of software and magazine subscriptions, cable TV, high-end phone packages, trips to Starbucks, etc. Get your expenses as low as possible so that all the money you save in Instruction #1 would stretch much further and longer for you. Do this now, not later.
Extra Tip: And also make a list of additional things you are keeping but can live without if things get really, really bad for you.
3. Start job hunting and job networking now.
Update your resume. Update your LinkedIN profile and start networking now, today, as soon as possible. Don't wait on this. Make new friends get to know some people who are top of the scale at local companies or people who own their companies. Get on their radar and make sure they know that you are open to opportunities with them. Make contacts with powerful people. You are going to need these powerful and influential friends during the recession. When opportunities are slim, people with connections tend to fair better. Make those connections now!
4. Set up extra income, now!
Start finding and setting up ways you can make extra or passive income. Do that now . . . not later, now! Understand doing side activities to gain extra income is very important for several reasons:
Reason #1: It takes some time to build up a good income from side gigs. It takes even more time to gain money from passive income activities. So you really need the 9-12 months that economists are predicting the recession will be felt by all of us to build up this income source. Use this time to ramp up your extra income possibilities.
Reason #2: This side (extra) income may become your primary or only income in the future recession. So put some effort in doing this. In fact, if you can more than one extra income stream that the better for you!
Reason #3: Save all the money you make on these side gigs for the next 9 to 12 months to get you to the Instruction #1 goal faster.
5. Pay down as much debt as you can
How do you do that? Simple. Sell everything. You are probably just like me, you probably have closets full of stuff you haven't touched in years. You have so much stuff in your two-car garage that you can't even put one car in it. Your cabinets are full of stuff that you were going to use "later." Take it out, dust it or clean it off and sell it. It's easy to list items on E-bay, Facebook MarketPlace, Craigslist, and Amazon.
Here are some places to go to help you quickly start.
6. Adjust your 401(K) & Investment Portfolio
This is the time to move most of your money from the growth-high risk option to the safe slow-growth option. It's all about preserving your hard-earned dollars here. You worked hard to put that money in your portfolio, try to preserve your hard work as long as you can. Don't worry, it won't be forever. As soon as the signs of recession are over, just flip them back into your high growth options in a couple of years.
7. Commit to no big purchases for one year.
You know what "big purchases" are. Big two-week vacations for the entire family, that new car you were thinking about leasing or buying, the possibility of buying a house. Hold that dream for just a second (12-18 months). You'll be able to do it later after the crashing waves of recession calm down.
That's it, my friends, if you follow this advice you should weather the storm nicely. Afterall, you are all my powerful and influential friends and I want to keep you that way.
For ideas on making money from side-gigs and passive income activities check out my post: Money is Everywhere: over 50 ways to make quick money.
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