1. Track your spending
In a recession, it becomes indispensable to know where your money is going, and not simply accept its absence. A recession forces us to take a hard look at spending, as the ever-increasing price of fuel influences the rising cost of almost everything else we buy. The poor economic conditions associated with a recession should give us gals the resources we need to establish strong spending habits and strategies that we observe for life. Make a budget and follow it. Learn to be stingy with your money, trimming down to necessities. During a recession, it becomes a priority in most households to track spending, but making this a priority no matter what is the smart thing to do with your money.
By now we all know the mantra, “Reduce, reuse, recycle”. In adverse economic climates, we girls can understand that if we waste less, we want less. What exactly do I mean by this? Well, it is straightforward in principal. Instead of buying a new sofa, repurpose a piece you already have. Reupholstering, for example, is a fraction of the cost of a new sofa. Better yet, buy a slipcover and save even more. Save the money you would have spent on new things by tucking it away for a rainy day. In recession conditions, when it rains, it often pours, taking the need for having an emergency fund to a new level. Take this lesson in frugality and learn to repurpose other things in your life, even when money is free flowing.
Don’t sit there and act as if you don’t know what I am talking about here. We all have our “necessary evils”. Whether yours are hair appointments, nail appointments, massage appointments or a long-standing addiction to Coach purses, it is time to put a end them. Put the wallet down and use that otherwise spent money in a high-yield savings account. When the economy is lousy, you will often find a need to dip into the “me” fund for essentials like groceries, toiletries and gas as prices continue to increase. Living without these “little luxuries” will teach you a lesson in frivolity. All the money you spend on items you don’t genuinely need is money you can use toward something more long term in rewards, in comparison to a simple (and fleeting) little luxury expense. Spend less money on frivolities and more on truly rewarding adventures.
We all have ways that work for us to help us save. Personally, I think piggy banks are cute, albeit not the best investment vehicle. Despite this, I use a piggy bank for loose change. Once I have fed the piggy bank to the point of combustion, I cash in the change using a service like Coinstar. Then, I put that money in a high-yield interest savings account. Naturally, this “pennies from heaven” bonus is in addition to the line item I put in my budget for savings. This little lesson creates pennies from heaven no matter the economy. Remember, it’s also never too late to start an online savings account – for more information on how to create bank account online, follow the link.
Think about other ways to make extra money. There are literally hundreds of things you can do to generate extra income from the comfort of your own home. Who knows when you might need it? Sign up for Mturk with Amazon.com, have a garage sale, sell crafts to local vendors, start a blog and monetize it; the list goes on and on for miles. Find what you have a natural aptitude or talent for doing and find a way to make money with it. Fire up the creative juices in your own life and figure out different strategies to keep earning and saving while you are waiting for the economy to improve. You may even just develop the next prominent million dollar business idea while sitting at home in your pajamas.