Many of those reading this have been through two periods of serious economic disturbance: the ‘08 recession, as well as the financial crisis that happened as a result of COVID (and is still unfolding to some degree.) As such, you might be looking at the ways the markets are shifting, and be thinking to yourself, “What can I do to protect my money in that situation?” Here, we’re going to look at a few options.
Get out of debt
As you might have expected, the first answer when it comes to anything related to financial security is to find your way out of debt as best as possible. Debt chains down your ability to use what money you have freely, and in times of economic uncertainty, when your own livelihood might be hit, it can become a lethal risk to your finances. Use tips such as debt consolidation to make it easier to start managing and paying off your debt now, and free up the resources that you need to do it as soon as you can.
Making your money shock-resistant
Investing your money and keeping it in assets, from stocks to crypto to real estate, is a good idea. It can help you grow your wealth, and diversify your holdings. However, in diversifying them, you want to make sure that at least some of your wealth is put into assets that are more resistant to changes in the market. For instance, you should look at the facts of choosing gold investment or stocks. It doesn’t necessarily have to be one or the other, it’s about finding the balance that works for you.
Build your emergency savings
You want to make sure that you’re able to protect your wealth in the event of a financial crash or similar economic swings. But that doesn’t mean that you want to be able to spend it. Aside from the money that you put aside for your future, or for growth purposes, you should also consider building an emergency fund. Financial uncertainty can bring sudden financial demands to you, as well, and an emergency fund is designed to cover you, even in cases of months of employment, which can make it a vital lifeline.
Work on your human capital, as well
It’s not just about what you do with your money, but what you do with yourself, as well. Consider yourself to be human capital, ready to be invested by other employers should you find yourself out of work. Work on developing yourself, finding the training, education, and skills that not only help you be of more worth to your current employer or in your current position but that allow you some freedom and flexibility if you need to move into another line of work, as well. Always take the time to develop yourself professionally.
Economic uncertainty is not something that’s easy for anyone to predict. As such, by the time that you’re trying to “react” to it, it’s often too late. Preparation needs to be done ahead of time.