Recession Can Happen, Here Are 9 Tips To Face It

If you regularly follow the news, then the word recession must be familiar. In fact, there have been many recessions since 1945.

A recession is a condition in which a country’s economy experiences a decline for two consecutive quarters or for one year. Like a domino effect, this can spread to other countries.

Recessions can occur in any country, including rich countries, such as America and China. In America alone, the last event ended on July 1, 2019 has lasted for 121 months.

What is Recession?

A recession is something that is very likely to occur due to the corona outbreak, explained the Indonesian Minister of Finance, Sri Mulyani. The government also moved quickly by formulating government regulations in lieu of law (perppu) as a way to overcome the economic recession.

The government has issued a Perppu on State Financial Policy and Financial System Stability as of March 31, 2020. In addition to prioritizing the health and social security sector, the perppu regulates monetary policy and the financial sector in order to support national economic stability. In addition, the government has also prepared several packages of corona handling programs that are ready to be implemented.

Recession is appropriate that may occur. Our job as citizens is to fortify ourselves by knowing how to overcome an economic downturn. Check out the tips below, OK!

One form of recession is a decline in the value of the currency, as happened in Venezuela in 2019. Not only does it kill the economy, it also causes a change in the way of life. Venezuelans are going back to the ancient way of bartering. This is done because the value of their currency is meaningless while the price of basic necessities becomes unreasonable.

Recession Mean An Economic Downturn

In addition, a recession can also mean an economic downturn. We can see the case of Mexico which experienced an economic decline of 0.3 percent.

The causes of a recession can vary, both from within and outside the country. Turkey’s economy slumped as a result of political polemics in Hong Kong that led to a recession in the region.

Do not panic! Check out the tips below as a way to deal with the worst possible economic recession.

With the development of technology, we can find out how and what reasons caused the recession. However, we do not know how and to what extent this affects a person’s life.

There are nine strategies that you can apply to deal with this:

#1 Prepare your emergency fund

You can increase the intensity of saving an emergency fund during a recession. Or increase the amount, for example from the initial three months of living expenses, to six months. Believe me, strategy will save you in times of crisis.

#2 Pay off debt immediately

Having a long-term debt plan is not a wise choice in a recession. For example, if you have a credit card. Paying off credit card bills can help increase your savings.

#3 A recession is a state of crisis, so save!

If you want to cut or even eliminate secondary expenses that are not urgent, then now is the right time to saving your money.

#4 Postpone big expenses first

Have a plan to buy a house or a car? Hold on. One of the factors that people fall into during a crisis is making big purchases, just before the recession.

#5 Recession is a state of crisis, so plan your stock portfolio again

Eits, this doesn’t mean you are throwing away your share ownership. However, it’s a good idea to rethink your portfolio to a safer alternative. For example, stocks of high dividends, real estate investment trusts (REITs), and shares of pare-down companies.

#6 Start accumulating cash reserves because a recession is a crisis situation

You don’t have to sell investments to raise cash. However, you collect new investments in cash or cash equivalents.

#7 Increase your capacity and quality at work

A recession is a reduction in staff. For that, you need to increase bargaining so that the company wants to keep you. You can do this by taking certified training.

#8 Find extra income

The sooner you collect cash, the better. You can take advantage of hidden abilities or develop existing hobbies.

#9 Keep a positive mindset!

It is undeniable that people will definitely be worried about a recession. And the way to deal with it is to don’t be panic! Having and practicing a positive mindset will keep you out of trouble.

Remember a recession is a distraction and only lasts for a while. And surely you will experience shocks in its implementation, that’s natural. However, we can definitely get through this together!

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