As Inflation rises, purchasing power declines and Ukraine is at war. What does that mean for the economy? To prepare properly for a financial or economic crisis, it is best to assume the worst.
Think carefully about preparing. An economic crisis will not be over in a week. The aftermath will be long, so you need to make sure you’re well prepared. Preparing always has a few basics that you should keep in mind, but in an economic crisis, you also have to think of the loss of the value of your money.
Having enough money is important.
In addition to debt, you don’t want your dollar to lose value. It is therefore important that you have a way to save money. The best way to distribute this is to divide it between cash, as well as gold, silver, and shares.
Build up a financial cash reserve/emergency fund first.
How much money should your cash reserve have? It really depends on your lifestyle and risk tolerance. In general, this should be between three and twelve months.
Imagine you need $2000 per month for your lifestyle. In addition, you feel comfortable when you have a cash reserve for six months. This means you want to build up a cash reserve of $12,000.
Increase your financial intelligence
Read books, watch videos and listen to podcasts about saving money and making more money.
Make sure you are less dependent on the basic things you pay for now. For example, think of electricity, by installing solar panels.
Basically, there are three steps to preparing for a financial crisis: find a way to make money, learn to save money by keeping it, and learn how to make money work for you(invest it).
Develop passive income streams
When you apply the three steps mentioned above, you are able to save and possibly invest at least a small amount. You only invest when you save your cash reserve!
You can then invest in real estate, shares, or start your own company. With these forms, you can earn a passive income. This makes you more financially independent and gives you more peace of mind.
Are you struggling to get ahead financially due to the mounting debt? If you answered ‘yes’, we can help. Click here to learn more.