In 2019, almost every well known economists expects a global economic crisis. Many economic indicators are also reporting a rapidly approaching global economic crisis. So what should we do to deal with the rapidly approaching economic crisis ? In this article, we sought some answers to this question and compiled our findings for you.
First of all we need to know; in times of crisis, money control is difficult. You must be cautious not to enter into a cash shortage. Besides, it is also necessary to know that economic crises do not take a long time and the economy will recover after a while. However, there are things that can be done before the crisis in order to overcome with the least damage and comfort.
Budget Planning is a Must
Budget planning is the basic financial measure that we have to implement in our daily lives, not only in times of crisis, but also in the personal finance plan, whether you have a firm or a sole person. Even if the crisis is not existed, saving will be effective in bringing your life to a better future. So how could you plan your or your firm’s budget?
The aim of budget planning is saving Money. The best way to make a budget is to analyze and record incomes and expenses accurately. The important point here is, to determine the expenditures that are not necessary and to restrict or completely cut these expenditures. In this way, your income and expense analysis will be successful and the money saving function, which is the main goal of budget planning, will be realized.
Do not Spend Above Your Pay Grade
For your budget to be sustainable, you must spend your money economically. You should not allow unnecessary expenses when planning how much you can spend after budget analysis. It is better for you, not make purchases above your income. This only be achieved by establishing a good balance of income and expense. The thing you need to be aware of here is, to see money as a goal, not as an instrument to reach your goal.
Evaluating money as a goal does not just mean savings. So buying real estate etc. is also not a plus you need to be protected from crises. Your aim should be to protect yourself from the crisis. You should keep your income more than your expense. You should limit your credit cards or totaly abandone them, and pay your bills and expenses only with cash.
Downsizing is Better Than Bankruptcy
In times of crisis most of the companies lay off workers, reduce their branches etc, briefly they go downsizing. As companies, you can also go downsizing. However, it is very important to determine your expenses. After budget analysis, you should reduce your cash needs as much as you can. For example, if the price of gasoline is rising, then you should prefer public transportation if it does not cost more, or you may sell your car to get rid off its expenses. On the other hand, If you have a company, you should stay away from customers who have problems with repayment. Because getting bunch of orders from customers sometimes do not mean everything is fine, especially in times of crisis.
Turning Crisis Into An Advantage
So far, we tried to explain how we can be protected from an economic crisis. What about turning crisis into an advantage? The most important thing you need to turn the crisis into an advantage is cash money. Because in times of crisis, people or companies that do not take the measures that we just mentioned remain in a difficult situation.
In such difficult situations, they have to sell their real estate or rights at reasonable prices in order to pay their debts etc. In addition, companies also makes ignificant reductions to prevent their sales from falling and to stay on the market. This is an important opportunity for those who have cash in their hands. The investments they make when the market is bad, brings much profit in a short time when the market recovers.
As a result, it is necessary to analyze the measures to be taken to get rid of the crisis and always have cash to turn crisis times into opportunities.
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