The following economic depression survival tips are all about preparation. With a bit of street smarts and a willingness to do what's needed you can survive losing everything. But it is better to prevent that from happening in the first place by being prepared for some worst case scenarios.
Depression Survival Tips - Keep That Income
Keep your job or other income and tough times aren't so tough. In fact, if you are still making the same money when prices are dropping, homes cost less and stocks are on sale, a depression can be an opportunity. So start by finding ways to preserve the income you have. Here are some tips for that.
Find a better job in a more secure industry if possible... Make sure that the boss knows you are a great worker... Transfer to parts of the company that are less likely to face layoffs... Cut costs in your small business as soon as sales start to drop... Find a second job if you have the time... Work overtime or extra shifts and save the money from these... Consider starting a low-investment low-risk business on the side to develop an alternate source of income.
Depression Survival Tips - Get Ready
Whatever you do, there is always a chance that you will lose your primary income. This is true in good times and bad, but in tough times it may be a long time before you can replace that income. This makes preparation in your personal life very important. Here are some tips for that.
Cut fixed expenses, like payments for rental furniture or appliances. The moment that you hear you are losing your job you can stop trips to the movies or bar, but other expenses are harder to quickly reduce and can drag you down fast. So get rid of the extra car you don't really need to have, or the unused boat that costs you for maintenance and insurance. List all of your household expenses and find ways to reduce each one if possible, but start with those that would be the most difficult to reduce quickly when hard times come.
If you are in particularly insecure industry (auto worker, real estate agent, mortgage broker, etc.), seriously consider downsizing your life in more drastic ways. A $600-per-month apartment in place of a $1,200 one means you can set aside an additional $9,000 in 15 months to be ready for whatever comes your way. It also means you'll have a much easier time finding a way to pay that rent if you lose your job. A nice $3,000 used car (they exist of you look) in place of a payment of $500 per month on a newer one means another $7,500 saved in 15 months, and no repossession risk if your income is lost.
Develop other sources of income to the extent possible. If you have a side business that makes a few hundred dollars per month and some dividend-paying stocks that generate regular checks for you, it's unlikely that you will lose all three sources of income at once.
The last few economic depression survival tips have to do with contingency plans. How much can you live on if you lose your primary income, and how will you do it? You may want to try living on that for a week to see if your plan is realistic. Can you sell some of your things if necessary, and do you know what they'll bring in a fast sale? How quickly can you find another job if you lose your current one? Make a list of possible jobs and who you'll need to contact. Have those numbers ready.
Lower your regular expenses, develop other income, have plans in place and money in the bank. Take those steps and you'll be better prepared than most for recessions, depressions or other tough times.