A recession can impact the lives of everyone across the whole world. Regardless of what you do or where you are, it’s likely that you have faced a recession at least once in your life.
Since 2008, recessions have become more frequent and the world definitely needs to know how to prepare for a recession.
What’s worse is that a large part of our population is still asking, “What is a recession?”. Well today, we intend to change that.
According to latest news, there’s a 40% possibility that the USA may enter a recession in 2023.
While we truly hope that doesn’t happen, if it does, it’s likely it will spread to the UK and the rest of the world.
Therefore, keeping in mind our “Hope for the best, prepare for the worst” philosophy, we have brought you this article.
Today, we are going to tell you how to prepare for a recession and how to maintain your financial stability throughout one.
What is a Recession?
In the simplest of terms, a recession is a period of time when the economy has been a state of decline for six months or more.
In a recession, typically unemployment rates rise, business activity slows, and, in some extreme cases, high inflation sets in.
Recessions are not new, and although they weren’t as well documented, they’ve been occurring for thousands of years.
The world has witnessed such trying times recently, in 2020 as a result of the pandemic and before that, in 2008 due to global financial mismanagement.
These times have severely affected the lives of millions and called for severe damage control by governments. Hence, it is always better to be prepared in advance to protect yourself from the ill effects of a recession. Well, we’ve got you covered.
Let us take a look at a few simple tips that will help you to be financially prepared for a recession.
5 Tips On How To Prepare For A Recession
1. Evaluate Your Monthly Budget
The first step to prepare yourself for a recession is to evaluate your monthly budget and follow conservative budgeting practices.
This refers to reducing all unnecessary expenses and making more room for savings.
2. Pay Off High-interest Debts
Paying off all high-interest debts, where a lot of your income is unnecessarily leaking, is a priority.
If you find yourself in a trying situation, you can always turn to Salad Money’s More than your score loans to help you with personal expenses. Moreover, you can also use one as a debt consolidation loan to avoid high interest rates.
3. Contribute More To Your Emergency Fund
This should probably be the first thing on your mind when you’re thinking about how to prepare for a recession.
Increasing your monthly savings and building a stronger emergency fund will certainly help you during a recession.
4. Build Your Resume
One of the worst things that can happen during a recession is a steep decline in employment rates.
A good way to prepare yourself to battle it is to build your resume and learn various new skills from platforms like YouTube and Udemy, which will build your resume.
5. Look For Passive Income Ideas
It is also a good idea to brainstorm some passive income ideas to earn a little extra cash on the side.
If you’re having trouble coming up with some, maybe our article about passive income ideas can help you.
Choose Salad Money for Fair and Affordable Personal Loans
Now that you know how to prepare for a recession, it’s time you use our ideas and plan your finances accordingly.
However, if you find yourself in a tough situation and have been wronged by the unfair credit score system, remember that Salad Money is always here for you.
Our fair, open banking-based affordability assessment helps us to assess your true creditworthiness, without considering your credit score in the initial lending decision.
Thus, with our affordable “More than your score” loans, you can get easy personal loans. Applying for one of our new loans doesn’t impact your credit score. We use Open Banking in our initial assessment. If successful, we report your loan to the CRA’s (Credit Reference Agencies). Your credit score won’t hold you back from being eligible.
To learn more about our services, visit our homepage or contact us now!
