Is a recession coming?

is there a recession coming

There may be a recession coming. Our economy tends to cycle and we’ve had a pretty long bull run. Does that mean the good times are coming to an end?

Quite possibly. The stock market keeps declining and I always have an ear to the local real estate agents. They’re saying housing, at least here, is moving slower.

Now, I’m not going to get into politics. Everyone loves to blame the other side since nobody is politics ever owns up to responsibility. Plus, how much of our economy is decided by politicians and how much is decided by innovators anyways? So instead, let’s talk about what you and I can do.

Safety net

The very first thing I would do is hoard cash. How big is your savings account? If you’re part of a two income family, it should be at least three months. If you’re a single earner, it should be longer.

During recessions, people get laid off. I sincerely hope it doesn’t happen to any of my readers. But realistically, jobs are less secure. So get that safety net in order.

Control your spending

As much as I hate misers, a recession is the one time I mimic one. I’ll still tip well of course because I’m not an asshole. But, unless you got more than one source of income, you might want to cut back on luxury items.

Speaking of which, yesterday is when you should have been starting up that second source of income.

Second source of income

Over the years, we’ve built up enough of a stock portfolio that in bad times, we get enough in dividends that we can use them for emergencies. That takes years though. It’s not an overnight thing.

I got a few good friends of mine who have positive cash flows from their real estate investments. There’s more than one way to skin a cat.

Along those lines, an internet business? Sure, why not?

It’s always a good thing to have more than one source of income but it becomes especially true during a recession.

What not to do

Don’t quit your day job unless…

Don’t quit your day job unless you either have another one lined up or you’re making enough money to get by in your second source of income. During recessions, you can still find work. It’s just, the odds are significantly worse.

If you hate your job, start interviewing elsewhere. But whereas during good times, you can walk out of a job that sucks, you really shouldn’t during a recession until you got something else lined up. That is unless you have fuck you money already and if so, this article’s not for you anyways.

Don’t quit your gym membership

“What? But it will save me money!”

You’ve already heard me say that health is more important than money a million times on this blog. Well guess what? I’ll say it again. Health is more important than money.

I’m also a strong believer in morale. The last thing you want to do is quit the one thing that burns off more stress than anything other than great sex.

So don’t quit your gym membership. Keep that going. Especially during a recession. If you have to cut something else out, then cut it out. Make sure working out is the last thing you cut out.

Action plan

How is your network?

This is the time to reach out to people. If you get laid off (I sincerely hope you don’t, but…), you’ve already taken that first step.

Even more important than a good resume is a network. Get that going. Make sure you have a backup plan if something happens with your job.

Practice interviewing ahead of time

I’ve heard people say you should be interviewing at least once a year anyways, even if you love your job.

Simply put, the more you practice, the better you get. That goes for everything from shooting baskets to playing the piano to interviewing. “Interviewing is something you can practice?” Yes, it is.

Do you have a friend in Human Resources at another company? Buy them a dinner in exchange for an hour of their time. Have them give you a mock interview. Have them grade your interview and tell you what you got right, what you got wrong, and where you need to go from there.

If you’re going really well

Now if you’re killing it, recessions are the time to get steals on investments. During recessions, stocks and/or real estate are undervalued. Figure out which one to buy and buy like a madman. You’ll get some huge discounts.

I hope there’s no recession coming

I don’t like them either. Even if I’m doing great, my friends and family aren’t.

Plus, there’s a general malaise during recessions. I’m a very empathetic man. I can feel when people are worried.

Yes, I’ll be timing the market and waiting for it to bottom out. Then I’ll go all in. But, these are real people getting laid off. Real people with kids to feed. So yes, you got to hope for the best. But be prepared.

About

Roman is an artist, composer, writer, and travel junkie.

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