Graph showing a recession on the way.

Steps To Take To Prepare For A Recession

There is a lot of debate about whether a recession is or is not on the way, but unfortunately signs are pointed in that direction. In any case, it never hurts to be prepared. Here are some tips that can help you prepare yourself so that you can handle any financial issue that comes your way. Even a recession.

The best way to prepare yourself for a potential recession and any financial problem is to save as much money as you can. During a recession, you will find that your dollars just do not go as far as they used to and this is where extra money comes in handy.

One of the best ways to save money is by cutting back on some of your regular household expenses. Even if you think that your budget is already stretched to the max, there are likely some place to make some cuts.

5 Ways To Save Money On Your Groceries

Your grocery budget is ripe with savings. Here are some tips to cut costs without changing your quality of food.

1. Create a grocery list.

This will help you know what to buy and prevent impulse buying. If you go grocery shopping without a clear plan, you can easily spend 10 to 20 percent more than you need to. This is money that would do much better in an emergency savings account.

2. Shop at warehouse stores.

Warehouse stores are well worth the slight cost of membership. They offer lower prices on bulk items, which can save you money in the long run. The only caveat is that you should not buy perishable items in bulk unless you are absolutely sure that you will finish them. A better bet with warehouse stores is buying non perishable and freezable food.

3. Buy store brands.

They often cost less than name-brand items and are just as good quality. In fact, many of the generics that you will find in stores are made by the same companies that produce the name brands.

4. Shop loss leaders.

Your local grocery store puts out an ad every week with a few very low cost items. It might be chicken one week and cereal the next. In any case, use this as an opportunity to stock up on the items you use the most, as long as they can be stored long term.

5. Plan your meals.

Meal planning is the process of planning out all of your meals for a week. Doing so allows you to make a very accurate grocery list, streamlining the shopping process and preventing you from wasting money.

5 Ways To Save Money On Eating Out

Even with a recession potentially on the horizon, we have to have some fun. That doesn’t mean that you can not save at the same time though.

1) Order water instead of soda or other drinks.

One of the highest profit margin items for a restaurant is beverages, especially alcoholic ones. Cut them out and save as much as 20 to 30 dollars a meal. Over the course of a year, this could represent a big chunk of the money you need.

2) Split the appetizer with your friends.

Apps are usually too big for one person. Share the cost with a friend or simply take turns buying the appetizer.

3) Share an entree with someone else at the table.

Most entrees are 1200 to 1500 calories, more than enough to feed two people. Even if the restaurant charges a split fee, you will come out ahead by sharing.

4) Join restaurant e-clubs.

An e-club will provide you with countless meal discounts. Visit the websites of your favorite restaurants and sign up for every e-club that you can.

5) Limit your meals out.

If you are used to dining out more than once a week, consider cutting back. Another option is to eat dinner at home and go out for dessert alone. You still get the restaurant experience, at a fraction of the cost.

5 Ways To Save On Electricity

Of your utility bills, the electric bill is almost always the most expensive. Here are some ways to cut your usage and lower your bill.

1. Reduce your energy consumption by adjusting the thermostat.

Setting your thermostat a few degrees warmer in the winter and a few degrees cooler in the winter can make a drastic difference. Savings of 400 dollars a year or ore are very attainable.

2. Turn off lights when you leave a room.

Your Dad was right, this is a big money saver.

3. Use your appliances during off-peak hours.

This can save you money if you live in an area that charges more for peak hour usage. Even if you do not though, operating them at off peak hours can reduce heat build up in your home during the hotter part of the day, sparing your air conditioner.

4. Unplug chargers and appliances when they are not in use.

This will help you to avoid phantom power usage, which is electricity that is still being used even though it is not being used by the appliance or charger plugged into an outlet.

5. Use natural light.

Natural light is free, making it an easy way to reduce your electric bill and create a more comfortable environment for yourself with natural light sources such as windows or skylights.

5 Ways To Save More On Utilities

There are more utility bills in your budget than just electricity. Here are some ways to save money on the rest of them so you can boost your recession savings.

1. Use a dishwasher instead of doing dishes by hand.

You might think that not running the dishwasher is a good thing, but this is incorrect. You actually use far more water when washing your dishes by hand.

2. Check your door and window seals.

Leaks at your door and window insulation will allow cold air into your home, increasing your gas bill and making your home uncomfortable.

3. Water deep once a week.

Watering your lawn deep will encourage deeper root growth, minimizing your lawn’s dependence on frequent watering.

4. Lower your water heater thermostat.

Remember, hot water is a convenience buy you are paying to keep 50 gallons of water hot all the time. Turn your thermostat down to 120 degrees to save on gas and reduce the possibility of burns.

5. Schedule a home energy audit.

Many utility providers will offer a free energy audit. Use it to make your home more efficient so that you can spend less on utilities and more on savings.

5 Ways To Save On Housing

Housing costs are not as easy to save on, because they usually involve some level of sacrifice. Still, if a recession is possibly in the future, all options should be on the table. Luckily, the cuts below can provide some considerable savings.

1. Live in a studio apartment.

If you rent an apartment, consider downsizing to a smaller unit. You will save money on the rent and all of the associated costs like utilities and insurance.

2. Live with roommates.

Taking on a roommate could provide you with another 600 dollars or more for your savings account. Just be sure to screen potential roommates carefully and make sure that you have similar personalities and values.

3. Move to a cheaper area.

Sometimes, even moving a few miles away can drastically impact your rent. If there are nearby areas that cost less, consider making a move.

4. Refinance your mortgage.

Refinancing a mortgage can stretch out your loan term and reduce your monthly payment. This is a potential option, but one that must be used with care. With rates on the rise, you could end up paying more on interest.

5. Raise your home insurance deductible.

Raising your deductible on your home owners insurance policy could cut your premiums in half. You will have to wait until your next escrow adjustment to realize the savings, but they could be as much as 200 bucks a month, depending on your current rate.

Posted by
James

James Car is a finance, loan and budget expert based in the United States. After attending Brookhaven college, he went on to become a successful entrepreneur. He now enjoys writing articles that help people save and make the most of their money.