Recession: Recession is an economic slowdown in a region or country, or sometimes it is global, which contracts across many months or even years. which result in a drastic increase in the value of the country's total GDP (gross domestic product), which is the total value of goods and services the country produces.
In this period, people get to feel sudden inflation in commodity prices more than actual inflation rates. Due to this, they feel financial crunches and crises, which result in a sudden decline in people's buying of commodities. So cash flow declines, resulting in the partial or complete shutdown of many businesses, which leads to increased unemployment.We last experienced the global recession of 2008, which lasted for a couple of years.Now, due to the global pandemic of the coronavirus in 2019, which had a negative impact on worldwide businesses like tourism, construction, airlines, manufacturing, oil and gas extraction, etc., this is resulting in a 2023 recession.
This sounds like a very unpleasant phase of any individual's financial life. But like a famous saying goes, if your neighbour lost a job, it's a recession; if it happens to you, then it's a depression.
So, We Are Giving a Few Tips to Keep Away from Recession and Depression in 2023. Here We Go.
1) Check your financial position:Sit down with pen and paper or an Excel sheet... Analyze a few parameters, like personal assets, liabilities, income statistics, spending, debt-to-income ratio, and your current net worth.By analysing it, you will come to know exactly where you are standing and in which direction you are moving.Based on personal data, you can cut down on expenses. And you will try to find new sources of passive income. So keep yourself floundering seamlessly against all odds that the recession brings.
2) Build your emergency fund: An emergency fund is a corpus that is equivalent to at least 3–6 months of your entire household expenses, through which you can cover your entire family's expenses in the event you lose your job until you get a new one. In a recessionary period, you have to have this emergency fund, which you should keep increasing by adding to every month, until the recession takes your job or your pay cut.
3) Cut down your daily expenses: You can save some money by cutting back on the services and things you can do without. For example, you can stop monthly subscriptions on magazines, e-magazines, OTT platforms, etc. The major daily expense is traveling. If you use a car for your daily commute, you can opt out and take car sharing or bikes to save a good amount on fuel and maintenance. You can save on electricity usage reductions by using it effectively.
4) Upskill yourself: Learn some trending skills like app development, digital marketing, online tutoring, etc. which will help you make additional income.
5) Don't invest for the long term in a high-ticket investment: Recession periods are generally times of correction, which includes price correction along with time correction.Big-ticket investments can attract financial crunches as well as losses due to price corrections. Please wait for an appropriate time for these types of investment decisions. If you have already invested heavily in stocks or real estate, please don't panic and treat it as a long-term investment., your debt-to-income ratio, and your current net worth.By analysing it, you will come to know exactly where you are standing and in which direction you are moving.Based on personal data, you can cut down on expenses. And you will try to find new sources of passive income. So keep yourself floundering seamlessly against all odds that the recession brings.
So, it is well said, Today's crisis holds Tomorrow's success stories. Be it your sucess story with the self deciplane act crafted by you in a today's recession Time.
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