Surviving the Recession

Now that people are starting to feel the effects of the "credit crunch", the big question is how do you avoid the backlash of the recession and continue living in the lap of luxury. The reality is you can't, but spending wisely will ensure that you feel less of a pinch then those who don't.

Weathering the storm

Desperate times don't necessarily call for desperate measures. Clear thinking and an awareness of the current situation can serve you just as well. If you're caught in a recession it's easy to start cutting costs in the obvious areas, but there may well be opportunities to save money being overlooked as a consequence. While I'm no Eddie Hobbs, here are a few of my tips to surviving the current economic conditions:

#1: Maximise Your Money

An obvious goal but there are certain ways of going about it. You could go out and rob a bank, taking the risk associated with that or go for a safer option: online banks. In a recession everyone tightens their belts and start cutting back on spending to save money, so if your going to have your money sitting in a vault you may as well have it earning the highest interest possible with the lowest fees. Because online banks don't have to pay for premises and other physical attributes usually costing a bank, they have less expenses than AIB or BOI.

#2: Make A Budget

Drawing up a cash budget should really be something you do anyway but it's vital in a recession. It gives you a broader view on your finances and also your liquidity. You shouldn't be spending money under the assumption that all your cash inflows will come through. After all you could lose your job and then what?! A budget will help you identify the areas where prompt payment is priority, like credit card bills, and where it can be put off for a time. It also gives you a better view of where you can make the cut-backs and how this will affect your disposable income (if you have any left!). One of the best uses of the budget is to identify and eliminate needless expenses ie. impulse buys. How you eliminate these expenses can involve a bit of willpower:


#3: Be Innovative

Think outside the box because since everyone is trying to save money, a good idea could give you that competitive advantage over the rest. We live in an age where globalisation is becoming more and more prominent and eBay is a great example of that. "One man's trash is another man's treasure" has never been more true with the explosion of this site's popularity. You probably won't be able to flog off that antique vase or the lock of Bono's hair you have, but there may be other objects of value. For example, a used games console would make an ideal birthday present for a recession stricken child.

#4: Bargain Bin

This needn't be as horrible as it sounds. My family have recently started shopping at Aldi instead of Tesco and when you look at the prices it's easy to see why. While the store lacks the recognised brand names, the quality is just as good and the price is certainly better. You can even treat yourself by buying luxury goods like sweets in bulk, and hardly feel the pinch. And for those of you who just HAVE to have the brands, they have started stocking some of the more popular names but at the same price as other stores. In relation to clothes, you can get a comfortable plain white t-shirt for €30 in Tommy Hilfiger or an exact replica for €8 in Dunnes Stores. The difference? A tiny rectangular crest that makes no different to the clothing itself. Again, its just a question of pride, something we can ill afford during these times.

Hopefully you can put these tips to good use and save yourself a bit of money. If not, then there are always the desperate measures mentioned earlier: