Recessions, though normal, are never welcomed. A recession is defined as an economic decline that lasts at least six months. Usually, they’re accompanied by images of doom and gloom. People often think they will simply have no money. They’ll be put on the streets, needing to seek charities for food and shelter. While these are pretty extreme cases, there are some things you can do to help make yourself more financially secure when hard times hit.
The most obvious thing is saving money in an emergency fund. Take some time and create a monthly budget. This includes any extra spending you do on family outings, date nights, etc. Once you’ve mapped out where all your money goes, start cutting out places you don’t need to spend. This might include making more meals at home instead of going out (about $3,000 per household goes to dining out every year) or canceling a streaming service.
Looking at where you can save money can’t be emphasized enough. Splurges are a big deal when it comes to cutting costs. Think of how much money you spend every time you go get your hair cut. This includes men and women. In 2016, the average price of a woman’s haircut was $45 and $34 for a man. What about manicures and pedicures? That’s an extra $25-$60 every visit. Assuming these are done once a month, that’s potentially $1,668 a year that could be saved. Take a look at the numbers.
This might not seem like much, but these little things can add up. Over time, start putting that money away into your emergency fund. No doubt you will be able to find several places where you can either lower spending or cut it out altogether. Being prepared might not be very fun, but when something does happen, you’ll be happy you saved a little extra for that rainy day.