- Students’ Column
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In 2008 millions of people lost a lot of money when the economy collapsed. Savings disappeared overnight, unemployment figures soared and major world leaders announced their countries had entered a recession. One of the main causes of the crash was the housing market. People were buying homes based on credit and guess what, it’s happening again. Research has shown that in 2016 buyers were investing in property that they couldn’t afford and leasing it out to people. It’s a recipe for disaster and one that could easily push the world towards another, deeper recession. It’s not the only problem that could have an impact in 2017 of course. As Britain edges towards leaving the EU, the disintegration of the European Union has begun. It’s difficult to say what type of impact this could have on the world economy as a whole. But it might be time to start preparing for the worse. How can you prevent an economic disaster destroying your finances?
If your job is based on providing a service or product that is an expense they don’t need, you might want to think about setting up a second income. During the time of a rough economy, people stop spending as much as cut backs begin. It happens slowly at first but eventually businesses see massive slumps in demand. This in itself isn’t a problem, unless you’re selling items people no long want to buy. If that’s the case, you need a backup. There are lots of side hustles that will give you a little extra cash in your accounts when you might need it.
You need to make sure that you are investing your money in the right area. In 2008 people lost savings because the interest rate fell. The money they had saved over the years lost a lot of value, and there was no way to get it back. The value of shares in companies fell too leaving some people with nothing.
There are only two real ways you can keep your money safe through investments, no matter what state the economy is in. You can either invest in property or you can invest in gold. If you invest in property, you need to make sure that you are buying the right type of property. If you look at something like 1031 exchange property you should be able to find some great opportunities on the market.
If you’re investing in gold, you just need to think about where you’re going to store it and how you’re going to keep it. Once you’ve answered those questions, you need to consider how much you want to invest in gold. Ideally, you should be looking at converting a large chunk of your capital.
Lastly, you might already have investments setup that could become risky if the economy turns. If there are any signs that the world economy could take a tumble, and right now there are, you should sell these off. Get the capital they are worth and invest it in areas that are less at risk.