How to recession proof your life

How to recession proof your life. The recession is making an impact on our lives one way or another, we are wherever we are always hearing the doom and gloom, so how do we make ourselves immune to this? We can certainly minimise the impact of the recession and the more people that do this the less likely they will be harmed by the downturn in the economy. Here are 5 steps to how to recession proof your life.

STEP 1 - SALARY

If your main stream of income is your salary then you need to protect it or somehow find other streams of income, consider insuring your income using income protection which is widely available, income protection in exchange for a monthly premium pays when you claim against redundancy or incapacity, you can also supplement your income using the internet, you can write articles on bukisa, you give sell items on ebay, whatever you choose make sure you diversify your income stream.

STEP 2 - INVESTMENTS

You may have noticed a fall in your pension pot or collective investments as the markets decline, maybe its time to consider alternative investments or a specialist hedge fund which can adapt to these market conditions, George Soros, head of Soros Investments made $1.5 billion in bonuses from his fund, this is because hedge funds can make money on the downside! you may also consider investing in Wine, Stamps fine art as these are safe havens during turbulant times.

STEP 3 - SAVINGS

Your savings will surely take a blow as the rate of interest falls, the best way to overcome this is to invest your money over longer periods so that you get a more favourable interest rate, if you dont need the money then invest in a guaranteed bond that pays significantly higher than the Bank Base Rate and wait for the proceeds to role in, remember to find out if your money is backed by the United States government in which case the money is guaranteed.

STEP 4 - BORROWINGS

The cost of borrowing has reduced! so if you have a tracker mortgage then the chances are you are actually paying a few dollars for your mortgage, this is the best time to borrow money if the banks lend to you as you will get a favourable interest rate, try and fix this amount over as many years as you possible can so that you can take advantage of the low interest for the years to come. This is a example of where the recession is affecting our lives positively.

STEP 5 - LIVING COSTS

As economic activity declines and productivity falls we are entering into a period of deflation where the price of goods and services decline, we are now able to buy cheaper items if we have the income to make the purchase, go shopping during the recession when the sale is on and buy items on credit where 0% interest is being offered over prolonged periods of time this way we will be getting the best deal.

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