Hello SmartLife Reader:
Is history repeating itself? According to Forbes, “What happens before every recession is happening again.” It’s an alarming pattern that we keep repeating. Everything looks good on paper until signals start appearing. They are not flashing red at first, but then you begin to see that things are not as they told us they were.
Some of the patterns to look for are: spending slows down, companies lay off, and the big financial bubble is ready to burst. On a more subtle note, right now we are looking at a long government shutdown. Some people didn’t get a paycheck, and this affects consumer confidence. When consumer confidence goes down, it means we have to earn the trust of the consumer back. This takes some time.
After the 2008 crash consumers did not have faith in the system. We still have aftermath from that public trauma. However, just like any storm you see on the horizon, you can prepare and have an easier time. Here are a few things you can do:
Start to secure extra income now. If you haven’t started a small business or side gig for extra money, now is the time to begin. This will help you establish another source of income. You can learn more about 6 of the best side businesses to start here. It will help you choose an income source that is simple to set up, launch, and can bring you income on the side.
Have cash on hand and savings. The cash you have in the bank is electronic or digital cash. You want some paper cash, as well. This is so important to do because some places may only take cash, and not your debit or credit card. Your savings is important for obvious reasons. But, I bet if we asked the hundreds of thousands of furloughed government workers if they would have liked to have more money saved, the answer would be “yes”.
Get rid of your debt. Having debt will be a killer. As much as you’ve heard everyone talk about the evils of debt, the debt hurdle as a recession begins is that it becomes harder to refinance debt. Credit gets tight during a recession and it doesn’t loosen up quickly. You will want to have as little debt as possible before the next downturn hits.
Right now our economy has a wild card. According to The Hustle, “A total of 800K federal workers will go unpaid, which cuts into consumer spending. Those workers buy fewer cars, eat out less often, sometimes miss rent… the list goes on. Mind you, furloughed workers will eventually get paid for their government-mandated “sabbaticals”. According to a report commissioned by the Obama administration, employee back pay cost the government $2.5B during the 2013 shutdown (its highest cost). That shutdown only lasted 16 days. As of today (January 15, 2019), we are currently at day 25.
Does that sound like poop to you?
Vickie Helm is a bestselling author, business and asset strategist, and the CEO of Smart Group Firm. She has improved the success of more than a thousand companies and the lives of thousands of individuals throughout her career. You can learn more about Vickie at https://thesmartlifeclub.com or https://vickiehelm.com.