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Different decades seem to have different financial challenges for everyone to get through. In the 1930s, it was the Great Depression and Midwest draughts that tested the will and resolve of a nation. The 1970s brought the oil crisis and difficult decision making for consumers, and the late 2000s had the banking and real estate crisis that proved challenging. But there have been lessons people have learned that make it easier to overcome the problems of the past, and here's a few things you can do in anticipation of future hard times.
Have A Plan For Investing That Can Overcome Inflation
After the crash of 1929 and the rise in prices in the stores, many consumers were left vulnerable to the effects of inflation. But while regular cash tends to become weaker in periods of inflation, sometimes other hard assets can rise in value during such periods. That's why it's good to make some investments in assets like real estate or gold because they may give you more buying power in the event you need to use them.
Look For Opportunities To Refinance Debt When Interest Rates Drop
Different decades have also seen the Federal Reserve raise and lower interest rates to match economic activity and ensure neither inflation, nor deflation runs away. When the Fed's interest rates drop, that's the time to see if you can refinance any loans you're paying off whether they're student loans, auto loans or even mortgages. Now refinancing does sometimes incur fees to cover the costs, and you do want to make sure you will be paying off your loan quicker and not later. But if it is an option, it's something you should look into.
Unemployment Or Temporary Layoffs Could Happen To Anyone, So Save For It
The sudden occurrence of 2008 and the economic fallout that happened because of it sent shockwaves through just about every job industry. Even those who had worked for companies that had had long histories of strong cash flow and performance were forced to make layoffs and scale back operations. The lesson learned is that no job is ever 100% secure. Even government workers can go through it during government shutdowns and other distress periods. That's why you should always prepare by building up savings funds both for emergencies and ongoing expenses just in case you lose your job and need time to find other work. If you are faced with an unexpected emergency before you have had a chance to fully build your emergency expense fund, know there are short-term alternative funding sources
like online cash advance lenders that might be able to help you cover the unexpected expense and get back on your feet.
Be Ready To Stock Up On Essential Items In Case National Emergencies Happen
One thing about the economy is it responds whenever a national emergency like 9-11 or the recent Coronavirus outbreak happens. Unfortunately, what this means is that consumers usually make a rush on commodities like gas or food and leave everyone in a dilemma. The problem is that because of price gouging laws that many states have, the supply often gets drained quickly, so by the time many consumers react to the emergency and decide to buy weeks or months’ worth of goods, it's too late. That's why along with saving up on money, you should also consider ordering food or basic household essentials from an emergency food supplier to be ready for an emergency.
At the end of the day, hardships and setbacks can happen, but making the right decisions and persevering will get you through them. The very foundation of budgeting is that every dollar has a purpose and will be used in a way that meets your long-term goals.
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