Here are seven tips to help make sure your finances are recession-proof, as recommended by experts.
- Pay down debt.
- Boost emergency savings.
- Identify ways to cut back.
- Live within your means.
- Focus on the long haul.
- Identify your risk tolerance.
- Continue your education and build up skills.
The 2020 recession has been unusual in many ways. The good news is the recession is likely technically over, but the drop in output has been so severe that getting back to the levels of activity we saw in late 2019 is likely to take years.
Your hours and wages may be reduced, too, Zandi says. Stocks: While stocks tank during a recession, they bounce back quicker. Typically, the stock market begins to fall from its peak months before the actual recession starts. It also starts to recover before the recession technically ends.
Higher education is famously recession-proof. If you are considering doing a graduate degree in part to escape from the downturn, you can be certain that hundreds of thousands of other people across the world have the same intention.
This study provides an overview of what the Great Recession meant for public schools, including: Ultimately, about 300,000 school employees lost their jobs. That's nearly 4% of the education workforce. States were hit harder if they relied more on state taxes, as opposed to local tax revenue, to fund schools.
In short, the opportunity cost of attending college is the cost of tuition, any associated costs, and any income, experience, and pleasure you miss out on because you choose to attend college.
"Grad school can be worth it," he says. Most graduate students in the 2015-2016 academic year – more than 70% – received some form of financial aid, according to an NCES data analysis from 2019. All of these options may help tip the scales to make graduate school worth the cost, experts say.
People with advanced degrees tend to earn bigger paychecks than those who have only an undergraduate degree. They're also more likely to land a job — and less likely to end up on their parents' couch. Median annual earnings were $69,100 for people with master's degrees and $57,600 for those with a bachelor's.
Not all graduate programs require an interview, but – increasingly – this is becoming more common. If you're applying to a graduate program, particularly (though not exclusively) to a doctoral program, you may face an interview, and you need to be prepared for the kinds of questions you may be asked.
Going to graduate school right after undergrad may be the best option for you if you know for sure that you want a graduate degree. Though undergrad is a long four years, you will already be in the “student” mode of studying and going to class. This can make it easier to power through a master's program.
Strategies for Finding a Job After Grad School
- Proven Ways for Finding a Job After Graduate School.
- Leverage Your Graduate School Professional Network.
- Attend Job Fairs at Colleges and Universities.
- Websites for Finding a Job After Grad School.
- First Job Out of Grad School Does Not Have to Be Your Career.
- Research and Prepare for Each Job Opportunity.
"During the Great Recession, our data showed that the impact on postsecondary institutions is not immediate; community colleges and for-profits saw the greatest increases in enrollment, mostly among older students who showed up later in the recession," said Doug Shapiro, Executive Director of the National Student
5 Ways the Next Recession Can Make You Rich
- Leverage your equity. In other words, don't splurge or buy yourself that new car you've wanted.
- Take advantage of defaults. It's often a cause and effect thing.
- Keep an eye on divorces.
- Help with the fallout from deaths.
- Watch for lower interest rates.
A recession and volatile stock market can lead investors to keep their money in cash, but beware of lost time in the market and inflation. For long-term investors, such as 401(k) plan participants, rebalancing and taking more market risk can be a smart move when stocks are down.
Top 6 “virtually” recession-proof jobs
- Medical professional. There are many jobs and specialties within the medical profession.
- Specialized care, therapy, and counseling.
- Law enforcement.
- Public utility services.
- Financial services.
- Education services.
- Construction and supporting industries.
- Home furnishing retail.
THINGS YOU SHOULDN'T DO DURING A RECESSION
- Becoming a Cosigner. Cosigning a loan can be a very risky thing to do even in flush economic times.
- Getting Into an Adjustable-Rate Mortgage. When purchasing a home, some individuals may choose to take out an adjustable rate mortgage (ARM).
- Adding Debt.
- Taking Your Job for Granted.
What Jobs Will Never Go Away?
- Healthcare Professionals.
- Nurse Anesthetists, Nurse Midwives and Nurse Practitioners.
- Registered Nurses.
- Physicians and Surgeons.
- Other Healthcare Career Paths.
- Public Safety and Security Professionals.
- Police Officers, Detectives and Criminal Investigators.
- Court Reporters.
In a recession, the rate of inflation tends to fall. This is because unemployment rises moderating wage inflation. Also with falling demand, firms respond by cutting prices. This fall in inflation can benefit those on fixed incomes or cash savings.
5 Money Saving Tips to Survive a Recession
- Save an Emergency Fund.
- Establish a Budget and Pay Down Your Debts.
- Downsize to a More Frugal Lifestyle.
- Diversify Your Income.
- Diversify Your Investments.
While higher level jobs may be harder to find and apply for during a recession, the skills a job needs can be important for your career. Find a job that you can grow with, that allows you to really showcase your talents, and that allows you to be an integral part of the team.
Economic recessions typically bring low interest rates and create a buyer's market for single-family homes. As long as you're secure about your ability to cover your mortgage payments, a downturn can be an opportune time to buy a home.
