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Financial crash concept on whiteWhat would do if you had a strong impression that another recession was coming soon? What kinds of actions and changes would you take to weather the coming storm? The steps that I list below aren’t a complete list by any means, and I don’t expect that anyone would be able to accomplish them all, but if any of them sparks something in you to do something that you’re not already doing to become better prepared for a sudden and significant economic downturn, I will have fulfilled the purpose of this blog.

The signs of a coming new recession are all around us:

  • There has never been a sufficient recovery from the Great Recession that started in the autumn of 2008 with the collapse of the housing market. A huge number of people have been unemployed or severely under-employed since that time. They haven’t experienced any recovery or reprieve, just a severe downslide to the brink of poverty and a radical adjustment to what for them has become “the new normal.”
  • Having tens of millions of new people become dependent on the government for food stamps, medical care, and other necessities of life has been a boat anchor for the economy. In a real recovery they would find decent jobs, they would produce something, make their own money, spend their own money, and save some of their own money. All of these things would make life better for everyone. Instead, it is a growing problem that will continue to apply downward pressure on the economy.
  • Big companies have begun laying people off again. Sandy and I run a business-to-business company. Our client businesses have stopped spending money, are laying off employees, and are offering early retirement deals to help save money in the future. All of these are signs of economic contraction.
  • The stock market has been climbing to record highs, but it’s all smoke and mirrors. The rise isn’t caused by underlying economic strength, but because of years of “economic easing,” the federal policy of printing billions of dollars of new money out of thin air. It creates the illusion of wealth without having any real foundation for it.

I could go on, but if you’re reading this article, you probably don’t need to be convinced. You just want to know what to do to help you prepare for it.

  • Stop the bleeding! Are you spending money as if all is well and everything will go on as it always has? Stop it. Take an honest look at every aspect of your life and look for places where you are spending money that you may soon wish you still had. Sandy and I love to travel, but because of the recessionary clouds on the horizon, we’re not going anywhere for a while. Our DirecTV bill is $100 per month. I’m looking into pulling the plug on it and going with all Internet-based streaming TV. Eating out can be another huge drain on a household budget. You can eat like royalty at home for a week for the price of one or two meals out at a marginal restaurant. Make sacrifices. Stop the bleeding.
  • Reduce your debt. Debt is the obligation for payment of money that you spent sometime in the past. Debt is just like the government’s economic easing policy — you generate cash out of thin air to buy things you can’t afford today and hope that you can find a way to pay for them tomorrow. When a recession hits and you aren’t making as much money as you used to (or no money at all), you don’t want to have to pay for purchases you made a long time ago. You’ll need everything that’s coming in to go toward current expenses. Reduce or eliminate your debt now so that you won’t be trying to pay for past expenses at a time of increased current need.
  • Spend wisely. Is there anything that you could buy now that would be a good investment against hard times to come? Is there anything that you could buy now that would either help reduce your expenses or increase your income in the future? I’m thinking about things like:
  • Sell some of your stuff. Do it now. We all have stuff that we don’t really use or need, but for some bizarre reason we hang on to. Sell it now, while you can find a buyer who has the money to pay you what’s it’s worth. The other option is waiting until a major recession hits, needing to sell it to generate cash, and not being able to find anyone who can afford to buy it.
  • Save wisely. It’s tempting to spend all of your money now to buy things that you expect to need in the future. Prices continue to inch upward on almost everything, while incomes remain flat or actually decrease. Some staples that we stocked up on a couple of years ago are selling for 25% more now. That’s a pretty good investment return. Some people believe that our money won’t be worth anything in the not-to-distant future, so they say you need to spend it now to get anything at all from it. I don’t know enough about that stuff to have an opinion on it, but I do know that having a cash reserve has always been a good idea in the past and looks like it’s still a wise choice for the foreseeable future. Saving wisely can be a tricky one. Save as much as you can afford to now so that you are able to meet future expenses, emergencies, or can pounce on a great deal if the opportunity presents itself, but don’t save so much that you can’t spend wisely and reduce your debt now.
  • Increase your income. Earning more money will help you accomplish all of the bullet points in this article. There’s a lot of talk these days about creating multiple revenue streams, which is just another way to say adding an additional source of income to your primary job. You’ve heard the old saying that “it takes money to make money.” Yes, but to meet the goals of the challenge of preparing for the sudden onset of a significant recession, you want to find something that you can do to earn extra money that won’t cost you an arm and a leg to set up. What can you do to earn a buck on the side without a lot of start-up costs?
    • Build things
    • Repair things
    • Cook / bake / cater food
    • Sewing and alterations
    • Create and sell crafts or works of art
    • Sell new or used products on Amazon (yes, you can do that), eBay, or Etsy
    • Pet-sitting or house-sitting
    • Do yardwork
  • Trust God. I really wanted to lead with this point, but I also didn’t want anyone to tune out before I got to it. You won’t find “God helps those who help themselves” quoted in the Bible anywhere, but I believe that God expects us to do our part, and He wants us to trust Him to do what we can’t. Some people refuse to prep because of their faith in God. I’m just the opposite — I prep because of my faith in God. I take action because I trust in Him.

Even since I sat down to write this I’ve received word of one of our client companies cutting their budget to the core and requiring all employees to take a week off without pay this summer. The storm clouds of recession (or worse) are everywhere. It’s time to get busy and it’s time to trust God.

14 Responses to Preparing for Recession

  • jayjay says:

    Cancel directv?? One word. Roku!!
    Haven’t had cable since 2008. Just bought roku and it’s fantastic.
    $8 a month for Netflix; watch what you want when you want.

    • Jayjay — We’ve been rocking the Roku / Netflix combo for about a year now. I find that I’m watching more Roku and less DirecTV all the time. I think the it’s just a matter of time. I can save $1,200 per year by ditching the satellite. Do you have any idea how long it takes me to make $1,200? Thx for writing.

  • Messenger says:

    Thanks for the effort and in ordinary times with nothing more than a serious hiccup in the economy coming your article would have been an excellent read. But what is coming is not the hiccups, it is a gut shot through the groin and we are going down for the count, as in never coming back. This is not going to be a run of the mill race to the bottom, it is going to be a plunge into darkness from which America will never recover. We are done sir;

    • Messenger — You may very well be correct. I don’t know for sure. I’m a subscriber to the “birth pains” view of end times events that Jesus talked about in Matthew 24. I don’t know if we’ve had enough “contractions” yet and can expect more to come, or if the baby is in fact about to be born (so to speak). Either way, as stated many times on the pages of this blog, our target audience is those new to prepping or who haven’t taken the plunge yet. Our goal is to get people who aren’t doing anything to start doing SOMETHING. The ultimate goal is to prepare for the gut shot, but everyone has to start somewhere. Thank you for commenting and I hope that you will share more of your views with us.

  • Rattlebone says:

    I agree with so much here, and want to state to the 2.4 BILLION Christians out there who THINK THEY know when the creature will arrive: Pleaase get up from thinking YOU know THIS may be the time of the return. “Fight evil until the death”. So those of you arrogant souls who think you know you can discern when the last days arrive, I say you are incredible selfish, and are part of allowing these SATANIC elitists to rule us they way they do! SO, arise, know their god is the god of light=SATAN, and say NO MORE! WE WILL NEVER,EVER KNOW WHEN THE LAST DAYS ARE!!!! It is easy to sit. It is easy to sit and think YOU don’t have to protect your beliefs: You MUST stand and fight, as SATAN is winning because you CHRISTIANS think you do not HAVE to fight! Think of the impact on the WORLD, if CHRISTIANS had ANY courage!!!
    So now, you ALL needed me to spank you! GOD BLESS YOU ALL!

    • Hey ‘Bone — You must have read the part in the Book where it says, “No one knows the day or the hour. Not even the Son!” Sounds pretty clear to me. But then comes the part about reading the signs of the times. The signs of the times will never provide a pinpoint date and time, but they give a general indication. But then there’s another problem. Namely, every generation since the time of Christ was flat-out certain that the signs of the times were showing that it would all happen during their lifetime. Every date-setter for the past 2,000 years has been wrong. So I don’t set dates. But as I replied to a previous commenter, I subscribe to Jesus’ “birth pains” analogy. As the day approaches (did you see how I cleverly wove the name of this blog in there?), the calamities will come closer together and will increase in intensity. Personally, I think things can get a lot more intense before the Day of the Lord arrives. But it can all happen relatively quickly, so I try to cover all my bases. But one of the great things I’ve found about prepping is that if you’re prepped for the Great Tribulation or the Zombie Apocalypse, you’re also well prepped for if you lose your job or get trapped by a bad ice storm. And so I keep one eye on the skies and another on the events of the world, all the while adding to my beans, bandaids, bullets, and knowledge base. And I try to warn others that I sincerely believe that God’s hand of protection has been removed (more like cast off) of America and that we are ripe for a major disaster in our economy, power grid, or any of another type of disaster. So stay prepped, my brother. Most of all for standing before the Lord our God, but also for whatever might come down the pike while we await His return.

      • Rattlebone says:

        I agree with your preps, just please, stand up and PREVENT these SATANIC ELITISTS who globalize everyone and everything! These are code words for controlling us. Even if you believe these days are predicted in the Bible, we cannot and should not allow these SATANIC people to KILL us! Terribly sad that we Christians do not stop what our Government is doing and foisting upon us by merely saying, “NO!”, to quote Nancy Reagan solution to everything! Anyway thank you for your reply: The Elite are terrified of one uniting idea to knock them down from their SATANIC pulpit!

  • FLAPrepper1 says:

    I dropped DishNetwork last year. I have OTA HD (Over-The-Air HD) for my local TV channels and Roku for everything else. i realized I only watched the Big 3 channels for Football. All the other channels, I really could care less. Too much Progressive/Hollyweird BS. I dropped my spending from $100+/month down to $8.00/month with netflix.
    A savings of $1,104 a year!

    • Sounds like it’s a bad time to be a cable or satellite TV provider. Lots of people jumping ship. They got too greedy. Price continue to go up instead of coming down, like most other areas of technology always do. Thx for writing.

    • Rattlebone says:

      Good on ya’ Mate! The more we all detach, the less we miss the struggles to have ‘stuff anyway!
      Whenever I feel the need to go out for a dinner, I then think of some more useful item I may want or need, or how much stored food I would like, and then I go in to cook my own!
      If you feel our money will be devalued, or cash eliminated, you can always buy much now…
      Personally, I do not know where these people who are going to “Bug Out” are going to go, and what they’re going to do, and how. Yes, I feel conflict is what we will choose: fight or flight. Remember what GLOBALIZATION means: That ALL peoples of our world, will now get the idea behind “ONE” means: That they get to oogle the big derriere of a Kardashian daily! I wanna be an american, I wanna be an american. Also, check out BONO (U2) whose efforts to save Africa have netted him HUNDREDS OF MILLIONS OF DOLLARS, and less than 2% of donations went to the cause! Good Luck Sir!

  • Of Wolf and Man says:

    I Think George Carlin once said in a stand up routine while poking fun at save the Earth activist’s, that the Earth, as much as its been through isn’t going anywhere… We Are ! He was right on with that remark.

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