Don't end up living in a Shantytown when the economy heads south.
There has been much speculation as to whether the recession of 2008-2009 will become another Great Depression. I’ve made my views on the subject in my post: Why the Recession of 2008 is More Like the Great Recession Than the Great Depression. I personally think that another Great Depression is unlikely. History doesn’t repeat itself, but it does rhyme. This is why I think a Great Recession is more likely.
Regardless if this is another Great Depression or whether we run into one in 10, 20 or 50+ years from now, there are some simple, sound financial moves you can make to ensure you’ll have the best chance of coming out of such economic Armageddon in the best way possible.
How to survive the Great Recession/Depression:
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Become debt free while you can, and stay that way.
Debt payments bleed cash from your income in the best of times. In the worst of times, those payments mean the difference between paying your mortgage, utilities and grocery bills. And that’s if you don’t lose your job. What are you going to do if you lose your income altogether? Have a plan, and consider such ugly possibilities before they happen.
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Have a sizeable savings.
To that end, it’s why an emergency savings of at least 3-6 months income is essential. More is better, but you have to start some where. Keep this savings in a high yield savings account. I recommend HSBC and ING. ING offers $25 free when you open an account with $250 or more.
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Remain marketable.
Even at the height of the Great Depression, 70-75% of workers were still employed. If you want to ensure that you are one of them, keep your skills up to date. Network. If you’re a tech savvy professional, create a LinkedIn profile. Join any associations your profession may offer. Join local volunteer groups, and keep your eyes and ears open for opportunities.
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