We have already been through the worst economic times in modern history. It’s still debatable as to whether the current economic strife–kicked off in 2007–is worse than the 1970s, although it can’t be many more months of recession until that era is certainly surpassed.
Does anyone see the light at the end of this tunnel?
The simple answer is no.
With the euro crisis dragging everyone down and with the BRICs countries crashing, the bottom of this slump still seems well into the future. If this is the case, the agenda for many of us is survival. Another four years of this economic environment will be a harsh road.
A survival situation doesn’t necessarily have to be a theatrical disaster, a zombie apocalypse or even a natural disaster that dilapidates the country. Economic survival doesn’t sound as “sexy” as the aforementioned, but by ignoring it we set ourselves up for a world of pain.
So, how to we prepare for a Depression?
First things first, find more income. Second, third, even fourth incomes are wonderful things. Many people use sites like ADVFN and become private investors, using guide books to help teach them the tricks of the trade.
As most of us live up to our incomes, money from occasional work and opportunities act as ‘windfall money’. In the end, most peoples’ discretionary income is a very small fraction of total income, so a few hundred dollars out of the blue from other activities does amount to a big win.
Whether it’s selling stuff on eBay, or offering B and B, you can’t have too many strings to your financial bow, especially when dark economic clouds are looming.
Also, keep your job. In the ‘good old days,’ many people could walk out of a job and straight into another. Long gone are the days you could get a job simply by driving into a different corporate car park and go knocking.
Of course, most sensible people know that staying employed is now more important than ever, still, it doesn’t do any harm to be reminded that people in jobs are inside the castle and those out of work are marooned in a harsh wilderness.
During the 1930’s it wasn’t hard times for everybody. The securely employed didn’t suffer the privations of those out of work.
Meanwhile, those who can just about happily retire should think about putting a bit more aside before departing the world of work for good. If we are in for another four to eight years of depression, retirement fund assumptions could shrink a lot. It might be worth at least waiting until you think the global crisis is over before cutting the cord to your work income.
Always Safe, Always Prepared