The COVID-19 pandemic has had a massive effect on labor markets and finance across the globe, and the full impact of this event remains to be seen. People from all walks of life are among those concerned about a potential economic recession. For individuals who are about to embark upon significant life events (such as getting married, buying a home, or retiring), this economic instability can be terrifying. In an attempt to minimize the financial impact of such an event, some folks are reevaluating their finances and looking to boost their income. Here are a few measures that some people are taking to prepare for a potential economic recession.
Learning About the Hallmarks of an Economic Recession
One of the most important things that people can do to prepare for an economic downturn is to learn more about what to expect by studying previous recessions. Based on events such as the 2008 financial crisis, Americans can expect a few trends to occur during the next economic recession — whenever that may be. Decreases in wages, job availability, consumer spending, and property value are among the hallmarks of a recession, and learning about these trends can help people prepare.
Building Savings While Paying Down High-Interest Loans
For those who worry that an economic downturn is imminent, building savings is a common strategy. To that end, some people seek to supplement their income with gig-based jobs, adding to the amount they can contribute to their rainy day fund. Many individuals also work to pay down their balances for loans and credit cards, particularly those with high interest rates. Reducing debt and increasing savings helps create a bit of a cushion for times of economic instability.
Preparing to Get Competitive in the Job Market
One of the scariest parts of a recession for many people is the reduced number of available jobs. With the worry that sources of income will be few and far between, individuals preparing for a recession may work towards learning new skills or becoming a more valuable employee. Maintaining a diverse professional network and building a repertoire of in-demand skills is one way that some professionals seek to add stability. Some people take training courses or get additional certifications to ensure that they have the skills they need to stay competitive and keep earning an income during periods of economic uncertainty.
Take Control of Your Finances with EveryIncome
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