Well, I’ve not been hit by the recession. I’m glad that I’m in India. Given the low Debt to GDP ratio of India, I’m reasonably confident that I would be in the same shape even after the dust settles. But at this point of time, all I see are the mass layoffs in Tech Industry. Since I’m a working professional too, I can empathise with you. According to me, here are the 5 lessons we should learn from recession 2023.
Lesson #1: Emergency Fund should be a Mandate
It is always good to keep a sum of your 6 months expenses aside as Emergency Fund. Some experts suggest 3 years, that entirely depends upon how much risky portfolio you hold. This can keep you in peace until you find your next job.
Lesson #2: Job Insurance (Optional)
During the recent COVID era, I saw my own friends facing mental agony with unable to pay their EMIs on time. To avoid being in such a situation in future, you can buy such an insurance with Policy Bazaar which pays your EMIs up to 3 months. Learn More
Lesson #3: Diversify without Fail
Well, I’m not here to judge your financial planner. But You need to diversify your investments in such a way that you wouldn’t be worthless in extreme situations. Like take a case where you invest all your money in one stock and that goes bankrupt due to recession. Even if you don’t diversify among different asset classes, at least diversify the stocks (different sector, different companies in same sector, number of stocks in portfolio) to reduce the risk to a great extent.
Lesson #4: Thrive to be a Multipotentialite
Learn at least one high paying skill like Content Writing, Digital Marketing, Data Analysis, Web Designing, Web Development or Application Development, so that you can freelance even if you lose your job. Better if you want to freelance with skills learned in your Day Job as well.
Lesson #5: Craft a Backup Plan Early in Your Life
You should have already started a money minting Side Business, be it Amazon FBA, SEO Agency or Software as a Service. A side business if flourished can help you become financially independent early in your life.
Did I miss something? Do let me know in the comments.