Here Comes the Chancla: How To Prepare for a Recession
“El prevenido vale por dos,” or “he who is prepared is worth double” is a saying we’ve all heard while in conversation with our abue during cafecito time. And even after all these years, it still rings true. In fact, now more than ever!
That’s right. We are sure that you probably heard the chisme going around. It goes something along the lines of, “la recession this, la recession that!…” but what REALLY is a recession?
A recession is a period of economic decline, which essentially means that the economy struggles, people lose work, companies make fewer sales, and the country’s overall economic output declines. Ay! That made us jump too.
While we know it’s scary to think that we might be heading towards an economic downturn, this too shall pass! And with the gems we are about to drop, you’ll be in good standing if you take action!
And in case you didn’t know, inflation is at an all-time high right now, which is why it’s now super vital to pay attention and prepare. Here are a few tips we live by and you should too!
Adios Credit Card!
Now that interest rates are through the roof it is super important to pay off all the deudita that we’ve been accumulating these last few months. We know your amig@ invited you to that Nodal concert, and we also know how you went all out for your prim@’s quince. It’s time to say BASTA to the frivolous spending and plan ahead. Time to visit our favorite tool… Goooal! Tracker
Your Budget Says No More Gustitos
We hate to rain on your parade, but cutting down on any unnecessary costs is ALWAYS a good idea, especially when preparing for a recession. Budgeting might not sound super glamorous, but it is the best way to understand where your money is going.
We know you’ve written 10+ page essays for that English class, so this should be a piece of cake for you. And you’re in luck too! Take out the hassle of setting everything up by yourself and download the SUMA App to get started on budgeting.
Say Hello To Your Little Friend
It’s called an Emergency Fund! We know you’ve heard it before. It is basically a cochinito (A.K.A. a savings account) where you put away money that can help you stay afloat financially for a couple of months – We recommend if things were to go south *cough cough* a recession, sudden job loss or other tragic circumstances.
Relying on prayer alone, however, won’t help. Any time you have extra cash or make a couple of bucks from those side gigs your tío found for you, make sure to put aside at least 20% of it. If that is not possible ANYTHING counts! Use our free savings tool and let’s start saving together.
Take A Page From Your Papá’s Book
Our papás are kings of learning how to repair anything. Oftentimes they teach themselves and eventually make extra dinerito from that side hustle they enjoy. So take that page from him and start looking at life with curious eyes. Is there anything that you can make better? do you naturally have a natural gift for fixing things?
Having curiosity and making it a side hustle is always a good skill to have when a recession is looming. It never hurts to have a little extra dinero to put away!
Think About Your Next Steps.
Are you a new graduate or thinking of going back to school? How about plunging into your next professional endeavor? Whatever you choose, keep in mind that it’s important during this time to really think about where you might want to be in the next 5 years.
Always make sure to reach out to mentors or counselors if you need help navigating this new landscape. We know as young professionals it can be overwhelming when it comes to overcoming difficult financial times. It’s not always about focusing on the dinero, but rather on things you enjoy that will naturally lead you to making that dough!
Now remember, no one can predict when the next recession will hit, but we do know that all recessions end. With all the information we have learned, now we are certain that if we are caught in the middle of an economic downpour we will have our financial umbrella to guard us from the rain. ¡Tu Puedes!
Want to continue learning more about finance? Then make sure to tune in to our FREE SUMA Academy.
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