With the rising cost of living, stock market decline, hike in interest rates, and headlines filled with layoffs, it seems everyone is bracing for a potential global recession in the near future. But how will it impact you, and are you prepared to face it?
For context, more than half of Americans live paycheck to paycheck, and almost a third have no savings whatsoever. If you find yourself in a similar situation, here are seven ways technology could help you during an economic recession.
1. Find Job Opportunities With LinkedIn
In a recession, many companies resort to laying off employees to cut expenses. If you happen to be one of those who got laid off, you can use LinkedIn to search for jobs. Small companies and startups rarely have enough cash flow to comfortably survive a recession, so they are likely to not hire candidates at the moment.
So, it’s recommended to target large established companies instead who are still hiring talents, albeit slowly. You’re likely to face serious competition since plenty of people just like you are searching for jobs after being laid off, so it’s necessary that you update your resume and learn how to write emails asking for a job opportunity.
2. Find Freelance Gigs With Upwork
Alongside searching for a job, consider looking for freelance gigs on platforms such as Upwork or Fiverr as a secondary source of income. As a freelancer, you have more control over your hours and can hence take on more projects to increase your income.
That said, remember that freelancing is not as stable as a full-time job. In fact, it’s likely that you’ll have trouble finding new freelance clients, face inconsistent workloads, and have to settle for low-paying clients in the beginning.
Over time, however, you can build a good portfolio and gather some positive testimonials that will help you appeal to high-paying clients. Make sure to learn how to set your own prices, approach clients, and close deals; you can also use these apps to find a side job.
Consider charging per project instead of per hour as the latter punishes you for being a fast worker; charging per project is simpler and reduces uncertainty for both parties.
3. Manage Your Household Budget With Budgeting Apps
If you don’t already keep a written household budget, it’s time to make one. There are plenty of budgeting apps that help manage your money, considering your income, expenses, loans, insurance premiums, investments, and more. The more organized your finances, the more control you have over them.
You can also use good ol’ Microsoft Excel to create a household budget if you find it easier to use over budgeting apps. You can find and download free templates online, so you don’t have to start from scratch and can simply edit data according to your income and expenses.
A great way to manage your household budget is to follow the 50/30/20 rule. According to it, 50% of your income should go towards your needs such as food, rent, gas, electricity, internet, and insurance; 30% towards your wants; and 20% towards your savings and investments.
4. Create a Stock Watchlist With Google Finance
You can create a stock watchlist on Google Finance to track your favorite stocks and search for investment opportunities during a recession. You can also use the tool to compare stocks, indices, and markets in real-time, track different currencies (including crypto) and futures contracts, and see the latest news stories about the market.
You can also use Google Finance to conduct fundamental analysis of a company by studying its income statement, balance sheet, and cash flow and see if it has been able to weather the storm. Note that Google Finance is not a trading app; you can’t use it to buy or sell securities, but only track them and conduct research.
5. Cancel Your Subscription Plans
If money is hard to come by, you should prioritize your needs over your wants, and try to save as much as possible. This means canceling your Netflix, Hulu, or Amazon Prime subscriptions—at least until you get a job and can afford these luxuries again.
You don’t have to let go of all entertainment; after all, you can always watch YouTube videos, read books at the public library, or download and play free offline games on your phone. Heck, even board games will do. Cancel as many subscriptions plans as you can and save up all that money for your needs and unforeseen emergencies.
6. Sell Your Old Stuff on Facebook Marketplace
You can consider selling your old stuff on marketplaces such as Craigslist, eBay, or Facebook Marketplace. If you decide to do so, you can increase your chances of finding a buyer by listing your item on multiple platforms, taking high-quality images, and writing an honest and detailed description.
Buying and selling stuff online comes at some risk since you’d essentially be meeting with strangers to hand over your item. If you decide to ship the item, there’s a possibility that the buyer never pays you. So, it’s best to follow these tips to stay safe when trading items online.
7. Increase Your Financial Literacy From Trusted Sources
Perhaps the most important thing to do in a recession is to increase your financial literacy. You can read articles, watch YouTube videos, listen to Spotify podcasts, or buy Udemy courses that promote financial literacy and educate you about saving money, paying off debt, building an emergency fund, increasing your credit score, and more.
However, make sure you only follow trusted creators, preferably with a financial background. Good, qualified creators will focus more on teaching you important concepts like inflation, depreciation, volatility, and compound interest. Bad creators will promote get-rich-quick schemes and nudge you to invest in highly-risky assets.
An economic recession is a very difficult time for many, but it doesn’t have to be for you if you take the necessary steps to ensure your financial security. With the tools we listed above, you can find new job opportunities, search freelance gigs, better manage your household budget, increase your financial literacy, and more.
If you live paycheck to paycheck, try your best to reduce your expenses as much as you can, and then use those savings to create an emergency fund worth at least three to six months of your household expenses. This will serve as a financial safety net in case you get laid off or need money for an emergency.