How to Prepare for the Next Recession
A recession is coming. We cannot deny it or wish it away, regardless of our politics. A market correction from the unprecedented peaks we’ve seen is due. Our SVP Cindi Cervone Carlson explains how to prepare for the next recession
Some of you are still traumatized by the 2008 downturn - and rightfully so. The good news is that the next correction will likely be less drastic. The bad news is that it may last longer.
“Why?” you ask. Simple: It likely won’t be one big bubble that bursts, but instead, a series of sequential market corrections across industries and geographies - each gradually impacted by the other.
Regardless of what the future holds, it’s best to think ahead and be prepared. The following is a handful of small, reasonable actions you can take to make sure you aren’t hit too hard by this cyclical demon.
● Become indispensable.
Job security directly correlates to how easily you can be replaced. Be the solution, not the problem. Become an expert at something no one else understands. Ask for additional projects. Proactively make your boss count on you at every turn. Hard work makes the day go by faster. When layoffs come, make sure your name isn’t the first one on the chopping block - keeping you employed.
● Start networking.
Always. Be. Networking. Always keep an eye on the market. Gone are the days where you work at one company forever. Act like it. Complacency is never rewarded. Continue to build your resume and stay sharp by interviewing for new jobs - even when satisfied with your current one. This will force you to update your success stories and expand your network (also known as your safety net), connecting you with new companies, recruiters, and search firms along the way.
● Pay off debt.
Cash flow is king - particularly if you have less coming in due to a job loss. Unemployment likely won’t cover your full income. Make it a priority to pay down debts, particularly those with high interest rates. Removing debt removes stress - which allows you to thrive in both the workplace, networking, and interview process.
● Start budgeting.
While you can’t predict the future, you can audit your finances. Are you spending a bit more than you should on streaming video/music services? I’m certainly guilty of this. Proactively sort needs and wants, or at very least, make a list of what you can eliminate each month - and how much money you’d save as a result. Have an up-to-date financial action plan for if/when you need to cut spending.
● Build confidence.
Imagine yourself pushed out of an airplane across three different scenarios: 1) With a professional skydiving instructor and parachute on your back; 2) Alone with a parachute on your back; or 3) Alone.
Getting fired without warning can certainly feel like the #3 scenario. Rather than risk that feeling, it’s best to build confidence by preparing. A strong budget, network, and presence within the workplace can prevent you from free-falling at all. But if/when a recession occurs, it’s best to be prepared, so that you can confidently land on your feet, no matter what happens.
Market corrections are cyclical. What goes up, must come down. Life isn’t always about being on top. Sometimes you have to fall to learn how to get back up (Can you tell I’m a new mother?).
Create purpose in your professional career, and move forward. When you do, the future is bright, no matter what happens.