How To Prepare For The Next Financial Crisis

| August 3, 2013 |

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Back in 2006 and 2007, several analysts, including Peter Schiff, warned that the worst of our financial troubles were yet to come. They also warned that these economic problems would not last for a few quarters, but for years, perhaps even a decade. The problem is that these voices were seen as dissenters, a few voices in a sea of pundits and analysts telling us how our economy was actually growing, unemployment was actually falling, and that we really didn’t have anything to worry about if we kept our heads down, worked hard, and kept the economy stimulated by not adjusting our buying habits and continuing to make purchases. For many, this advice proved disastrous and people began to lose their homes, jobs, cars, and even lives in droves.

Now, several years later, we sit in a similar situation. There are some indications of an economic upturn, but many of those same voices are now warning us that nothing in our system has fundamentally changed, and we can’t expect any different results in the coming years. According to some, the worst is yet to come. This is not a conspiracy, or a fringe theory, it’s a real, daunting prospect that would be foolhardy to at least not give some thought to. If you’re like me, then you like to at least be prepared for what life, the world, and your country throw at you, so here’s some advice on surviving when the economy goes south again and money gets tight.

First of all, make sure you don’t lose your house, or at least your primary property. If you have a second home or a vacation home, try and save it too, but there may come a time when it makes the most sense to liquidate it in order to keep your main residence, and your family, afloat. If you’re like many in this situation and lose your job, make sure you aren’t thinking of yourself as “above” doing a certain kind of work if it might mean saving your house.

Along this same vein of thinking, make sure everyone in the house is helping out. While no one will be getting their dream job during a financial crisis, 2-4 people pooling the money they are making can be enough to get by, and can be the difference between making it through to recovery on the other side, and losing even your most basic necessities like shelter and food.

Think positively. In these types of situations, think about what your talents are and how you might be able to monetize them. Let’s say you used to do web design for an advertising firm and were let go. Maybe you can’t find another firm, but you could offer your services to local businesses on your own. The same goes for an artistic talent you may have but have always kept as a hobby; maybe it seems beneath you, or maybe intimidating, to go perform on the streets, but if you’re good at something it may turn into an oddly satisfying way to make enough money to survive.

The name of the game when it comes to hard financial times within a family unit is to be versatile and creative. As far as we’re certain, you only have one life to live and there’s something to be learned from every situation. Make the most of what you have, work hard, and you might just see the light of day on the other side of the tunnel (and come out a stronger person for it!).

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