Recession-Proof Yourself: 10 Tips To Keep You Afloat

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Times are hard. Layoffs, a frozen credit market, business contraction, lowered consumer spending – we live in unprecedented economic times. Is it a recession? A depression? Well, whatever you call it, the prudent individual will take steps today to keep his or her job, home and quality of life in tact – especially during these choppy economic times. So, what can you do today to recession-proof your life? More than you ever imagined.

1. Make yourself indispensible at work. If you’re the only one who can get the copier to work, if you’re the only one who can figure out the order tracking system, the client management system – you’re indispensible. The last one out the door if the business shuts down. To make yourself indispensible on the job, learn how all systems operate. Understand the order arc, and learn to un-jam the copy machine. The more you know about your particular business the more indispensible you become.
2. Keep up with the industry. Read industry journals to keep up with the latest in technology and trends. This is especially important in high-flying, fast-moving industries like electronics or computer software. What you learned in school? Old news. Stay current, stay valuable.
3. Take courses. Again, the more you know - the more you can bring to the table - the more valuable you are to your current employer. And the more attractive a candidate you are to a potential employer. Never stop learning. It’s an important aspect of keeping your job.
4. Stay on top of the job market in your business space. Of course, websites like monster.com provide data on jobs world-wide. And the competition is fierce for any job posted. Instead, visit websites of companies that are in your business space. Often, these sites have a tab for “Employment Opportunities,” something worth a bookmark and regular check backs. If you’re a recent graduate, contact your school’s placement office – a lot. Keep on them and let the alma mater network work for you.
5. Stop borrowing money. Every time you charge a purchase to a credit card you borrow money. And we all know how easy it is to borrow money using plastic. Cut up all credit cards except one – for emergencies. Also, do NOT use one of those credit consolidation companies. They charge a fee for services rendered, i.e. you’re borrowing more money. If you can’t pay cash, you can’t have it. Simple rule to always remember: You can not borrow your way out of debt.
6. Trim your expenses. Lower the thermostat. Skip the vacation and enjoy a “stay-cation” from home. Clip coupons. A coupon clipper can easily save 10% on the food bill, no problem. That could add up to over $1,000 a year after tax dollars, so you’d have to earn $1350 to have that extra $1,000 each year. And it takes 10 minutes a week once you get it down.
7. Pay off expensive debt first. A second mortgage runs at about 4.5% interest. That’s cheap money. On the other hand, your overdue credit card payment just bumped your rate up to 29%. That’s very expensive money. Check the rates you pay on all debt and work on the most expensive debt first to make the biggest impact on your finances.
8. Start saving. The first check you write when you pay the bills should be to yourself. Forget the phone. Forget the electric. Pay yourself first, even if it’s just a few dollars a week. Put this money in a money market account. Remember your objective? Try to build up six months of living expenses – in cash! That’s money that’ll get you through a layoff without total panic setting in.
9. Keep your Rolodex up to date. Contacts are your best resource in the event you do get laid off or the business closes. Stay in touch with sub-contractors, vendors and other business associates and always keep your eye out for a better, more secure opportunity. The grapevine always has the latest industry news.
10. Supplement your income. Take a part-time job on week-ends. Work from home if you have a saleable skill or can consult. Heck, take a paper route. It’ll cover some of your current expenses and will fill in the gaps in the event of a lay-off. The key to recession-proofing yourself and your family, your home and your lifestyle, is all in preparation. Start today, even if your job is secure and you’ve got money stashed under the mattress.

Just remember, today the sun may shine. Tomorrow it may rain. Get your umbrella today.

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