Recession and financial crisis time are periods when people start to re-think their priorities and value possessions and luxuries they have previously taken for granted. It is important to have a well-designed plan in order to face all the problems a recession throws to anybody and equally save despite the challenging time. It is still possible to save experts say. If a person does not manage to do so, the wave of crisis will throw him hard against the cliffs of despair.
Experts say staying alert is very important at this crucial time as to what is going on in the financial industry. A recession can shake things up very quickly, causing old industries to collapse like the housing market and equally cause new industries to be born like the alternative energy market. The information you gain could save you a lot of money and lead you to new opportunities. Experts advise you make it a daily routine to read current financial articles, financial newspapers and magazines each day during this period. Chances are that you will stumble on vital information’s to help you make decisions on investing or saving. Being prepared for opportunities is perhaps the best strategy you can have at times like this.
Financial experts say if you don’t already have a budget, this is a good time to create one. You can use a budget to reduce unnecessary expenses and it will also enable you save at crisis period. Experts also advices you pay up your debt and your bills on time. A single late payment means that you could pay a much higher interest rate on any future loans and on your existing credit card accounts. Also build a savings account of three to six months of your living expenses. This will be a great help if you get laid off and have to find a different job. Also ensure you get out of consumer debt as fast as you can, experts say.
Even in Recession, you can still save, Experts say at difficult economic times it is preferable to move your investments to lower-risk securities like bonds during the market shakedown. Another option is to invest in commodities like gold, silver and diamonds which will likely return high profits.
Your mortgage payment is likely to be your largest monthly bill. Reduce your mortgage with one of the many options including downsizing, doubling up, renting, or even foreclosing. Equally do not make large financial commitments, like remodeling or purchasing a new home at this time, experts say. Typically, large projects will hurt anyone’s budget because most require a huge cash advance or a loan just to fund such project. If you have been planning to finish an on-going project during this period it is advisable to put it on hold, just in case you need the money or run into an opportunity to invest it for a large return or get a good deal on a product being liquidated at a huge discount due to oversupply from the economic slowdown.
Experts say creating another income source will be a good idea; even a small one will be helpful in times like this to help you generate income you can save should the recession continue.
Experts also advice instead of going on an expensive vacation, consider an alternative family vacation that is more likely to be cheaper. If you don’t have the cash to pay for your vacation, then it’s probably not a good idea to put it on your credit cards.