There is always an opportunity found in every chaos. The pandemic slowing down, the war between countries, gas prices skyrocketing, rising inflation, and now talks of a recession on our hands. We have been going through it and can be difficult to see clearly during the storm. But it's not the time to be enveloped by all of the chaos but rather work towards setting ourselves up for success and seeing this recession as an opportunity for growth. In this article, we will tell you all that you need to know on how to handle the recession and what you can do to prepare.
What Is A Recession?
Firstly, these aren’t once-in-a-lifetime circumstances and used to occur more frequently. For example, since the great depression, we found ourselves in a recession in 1937-38, 1945, 1948-49, 1953-54, 1957-58, 1960-61, and so on. Despite becoming much less frequent - said to be because policymakers have been able to have a firmer grasp of why recessions were happening – their sting is still the same.
Forbes Advisor describes it as “a significant decline in economic activity that lasts for months or even years. Experts declare a recession when a nation’s economy experiences negative gross domestic product (GDP), rising levels of unemployment, falling retail sales, and contracting measures of income and manufacturing for an extended period of time. Recessions are considered an unavoidable part of the business cycle—or the regular cadence of expansion and contraction that occurs in a nation’s economy.”
Therefore, when recessions occur, we find ourselves in situations of economic struggle. Jobs are lost, people find themselves in financial setbacks, those who are in school may find it difficult to find jobs, and we need to rely on savings or worst-case scenario, file for bankruptcy. While these are all pretty daunting experiences, rather than dwell on the potential outcomes, we need to find the solutions. If investments and stocks are a little overwhelming at this point — or not an option for you — there are other ways we can work on coming through the recession with minimal downfall!
How To Survive A Recession?
Your work life could be the most affected during this time. Recessions seem to inevitably come with employment losses and there isn’t much we can really do about it. Nevertheless, we can try and prepare ourselves for the worst.
You can do this by:
• Updating your resume and potentially expanding your skill sets. This is the ideal opportunity to invest in yourself. Putting yourself in a position to be more needed by employers or allowing yourselves to be in a better position if you need to find new work. There are plenty of free online courses or affordable options for you to start expanding your skills.
• Finding a second income can seem a little bit farfetched for some, but It might be worth looking into having multiple jobs. Ever since the pandemic and now the Inflation is driving some remote workers to have more than one or two jobs to get ahead financially can be a good thing in the long haul.
• Whether it's networking inside of your company, with other companies or even online. Get your name out there and show your face to potential future opportunities. While some people obtain jobs by handing in their resumes and being interviewed, many positions are given to those that companies and businesses know and trust. Networking can be a great way to put your foot in the door and to get yourself in the back of someone’s mind.
• If you have the opportunity to work from home, take it. In a March-April 2021 survey by FlexJobs, they were able to discover the amount of money saved was “the number two benefit of remote work (75%), second only to not having a commute (84%). Additionally, 38% estimate that they are saving at least $5,000 a year working remotely, while one out of five estimates that they save more than $200 per week, or $10,000 a year.”
The toughest part of a recession can be the cutbacks for some in their everyday life. But the little moves you execute now can not only get you ready for the recession but help you get into a nice flow of being comfortable in your changes. These can include:
• How you do your food shopping or what your eating habits are can really impact your wallet. At this point (October 2022) supermarket inflation has been on the rise and while restaurants have been too, they haven’t been going up as much. In reality, that can mean eating out is less expensive than eating in, but many circumstances come with that. Firstly, this can all depend on what type of shopping you do. Keeping your groceries simple (staple items) and healthy (fruits, vegetables, grains, etc.) will not only be the more inexpensive items you can purchase but also the healthiest. This brings us to our next point; restaurant food is more often than not unhealthy for us. When we acquire the habit of eating badly, we run into health issues that cost us an arm and a leg in medical bills. Therefore, in the long run, even though groceries are technically more expensive now, eating out can have more of an impact in the future.
• Using fewer utilities in your home is one of the most common ways to save money and has been around for a while. This can include using less electricity and focusing on natural light or alternate low lighting systems (i.e. candles but be careful!), taking shorter and less frequent showers, wearing fewer clothing options, and only washing in bulk, etc.
• Have you ever looked at your closet and thought “Ugh, I have no clothes to wear,” when in fact, you have a closet full of clothes to wear? Excess shopping is going to be one of your biggest temptations and burdens. Whether you just utilize the clothes you have in alternative ways, create new clothing items with your existing clothes, swap with friends, or sell them to make some extra money and room. Personal shopping may have to wait until you’re in a more financially secure position. And let’s be real, it’s all about confidence anyway.
• Use more public transport! Although for some people this is going to be impossible, for others it can be an opportunity to save a lot of money in the long term. Especially if you are capable of living 100% with public transport. If this is the case you can reduce the use of your car or rid of it altogether. That means no gas payment, maintenance, and insurance payments. Once the world is back on its feet, you can venture out once again.
• We all know that sometimes our unhealthy habits can seem like an easy way out. However, these unhealthy habits also take a considerable chunk of cash, impact mental health, and effects our overall physical well-being. Especially during stressful times, it might be better to start making healthier choices.
It's necessary to remember that recessions don’t last forever. You may find yourself in a difficult situation, but following these steps above can soften the blow if things really do start to look bleak. Take that little extra time to see where your money is going, how you are taking care of yourself, and what you need to do to cut costs. It’s a temporary adjustment, but one that could help you in the long run.