What Should You Do in a Recession?
Posted by hidayathfund on October 9, 2008
1. Aggressively reduce debt
Take a good, hard look at your short-term liabilities, including credit cards. Set aggressive goals to cut your expenditures, increase your savings and available credit, and work hard to eliminate any debt with high interest rates.
2. Find one-three additional revenue streams
This could be a side business, a part-time position, selling of stuff that you can produce or obtain (excluding theft). Start building now in the event that you need to ratchet up one or more of these sources quickly.
3. Prepare your resume for August 2008 and June 2009
This isn’t a typing and formatting exercise. What do you want it to look like after the first half of this year? What can you get done over the next eighteen months? Be prepared as companies will accelerate layoffs under the earnings pressures to come. If your company is struggling, now is a great time to start networking. It is always easier to find a job when you have one.
4. Make the switch if you’re thinking about it
Have you been pondering taking a new path in your career, say switching to being and educator or heading to Healthcare? Figure out how to start back into educating yourself as soon as possible so that you’re ready with new skills in 1-3 years.
5. Celebrate life
While you cut costs, find fewer better things to do with your time and resources. Cook and over-the-top gourmet meal once a month. Take only one big trip but make it the best one ever. Take on a new hobby that interests someone else important to you. Shut off your computer two days a week when you aren’t working. Use this time as a time to energize the health of your relationships and yourself.
6. Acquire opportunistically
There will be deals to be had, so find some resources to take advantage of them. This means that you’ll have to spend more time being sure you know whatever it is that you’re focused on (so that you know when the deals are great or when you’re the sucker). This year will be a year of the buyer for many, many things if you have the resources deploy. Find some resources to deploy and get after.
7. Wait a bit longer, then spend on advertising and marketing
These are the prime areas to cut in most businesses, which means these are the prime times to get great deals as well as to stand out in whatever industry you are in. If you are in the advertising and marketing industry, this will be a time where ROI and creativity will be king.
8. Don’t shrink away at work
Benjamin Franklin, in his autobiography, said that he carried a large package across the streets in the morning then returned with it in the afternoon. The purpose was to give the impression that he was a hard worker. Now is the time to be a hard worker. Take on more responsibility and don’t quibble about whether you should be paid for it. Become indispensable and visible. Make absolutely sure that whatever you do is contributing directly to the success of your company. Find cost savings each month, no matter how trivial. Run with growth ideas.
9. Hold off on toys
Even if the next plasma screen or iPhone looks enticing, just say no. Liquidity is more important than being cool.
10. Take the losses
Sell whatever you were going to sell at the best price you can get. It won’t get any better later.
Bonus for parents Teach your kids what’s important in life Don’t let this be a time that breaks your family apart or tears down your marriage. Show your kids how irrelevant things are, how unimportant what everyone else has is to your self-worth, how important intimacy and involvement are in the lives of your family. Use this time as a time of rebirth for your loved ones rather than a time of tremendous stress.