(ModernSurvival.org) – Talks of a looming recession tend to be heavy in the news from time to time, resurfacing in times of economic difficulty. During these periods, job security tends to be low, the stock market may be unstable, and the housing market is uncertain at best. Families across the nation may be living paycheck to paycheck, struggling to make ends meet. So what can a person do to help their family survive a recession?
A recession doesn’t have to spell doom for your finances. From cutting back on expenses and couponing to generating new income streams, the following tips will help you stand your ground in an unstable economy or prepare for the next wave.
Become Mindful of Your Spending
It becomes increasingly important to track your spending during tough economic times. One of the best tools to help you become mindful of your spending is budgeting. Begin by listing your monthly income and expenses, then subtract your expenses from your income. Look for any areas where unnecessary costs can be cut out.
For example, cook at home instead of going out to eat. You may not realize how much you are spending until you begin tracking those costs and start cooking and eating at home. You can also cut back on entertainment spending, such as online subscriptions like Netflix or trips to the movie theatre, by staying home and enjoying household game nights or movie parties with friends.
Keeping a detailed budget empowers you to stretch your financial resources and weather tough economic times.
Apply for Food Assistance Benefits
Applying for food stamps can be a lifesaver during tough times, especially for those who have been the victim of a layoff or lack of job security. While it may seem like a last resort, don’t overlook the Supplemental Nutrition Assistance Program (SNAP) — previously known as food stamps. SNAP helps low-income families put food on their tables and feed their children.
To qualify for SNAP, your household must meet certain income and asset eligibility requirements to qualify for SNAP. However, even if your income exceeds the set threshold, you may still qualify for benefits if you have a dependent child in the home or have high medical expenses. The application can take some time, but the assistance provided by the program can make a huge difference for a struggling family.
If you don’t qualify for SNAP benefits, other food assistance programs exist, including local charities.
Look for Energy Assistance Programs
Many people are unaware of the assistance programs offered by the government, such as the Low Income Home Energy Assistance Program (LIHEAP), to help low-income families pay their energy bills. Typically run by state or local governments, these programs provide vital financial assistance to qualified applicants.
To determine your eligibility for these programs, contact your local utility company or government agency that operates the program in your area. You’ll likely have to provide financial information, such as income and expenses, as well as documentation proving your need for assistance. Thankfully, the application process is relatively simple and can provide a helping hand to those in need.
Negotiate Your Rent or Mortgage
Some landlords and mortgage lenders offer payment relief programs for struggling tenants and homeowners. Checking for such a program is a good idea when experiencing financial hardship, though there are income requirements to qualify for these programs.
Reach out to your landlord or mortgage company and explain your situation. Be honest with them and explain why your financial hardships are causing you to need lowered or delayed payments. Many companies are willing to work with you under these circumstances, but they must know that you’re really struggling, and you must be prepared to negotiate.
Create an Emergency Fund
Having money set aside for a rainy day is always a good idea, but when the economy is floundering, it becomes even more critical. Begin with small savings goals that you can contribute to regularly. This will help you make a habit of stashing money away and motivate you to keep it up.
Having an emergency fund to fall back on ensures your family won’t crumble beneath the weight of an unexpected layoff or unforeseen medical expense. An emergency nest egg provides peace of mind in knowing you’re prepared for whatever storm life may throw at you.
Experts suggest having enough money in reserve to cover three to six months of living expenses. While this may not be feasible for everyone, even a little bit of savings can make a big difference in an emergency. Start by stashing away as much as you can afford each month until you have accumulated a sizeable fund.
Create New Income Streams
An extra income stream is often enough to help you through tough times. A creative side hustle, or form of income outside your full-time job, will bring in extra money and help you weather the storm. Becoming a Lyft, Uber, or DoorDash driver during your off hours, doing lawn care, babysitting, or even taking paid online surveys are great ways to make extra cash on the side.
A side hustle is a great way to prepare for and survive a potential recession.
Preparation is Vital
A recession can spell financial doom for those who are unprepared. Don’t wait for a recession to strike before taking action to prepare your family. Get started today to improve your family’s odds of surviving the next financial storm.
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