Survival Strategies:
Families may need to rethink college plans during a recession, and should look into alternative ways to pay for school in order to save money. Most college students receive some sort of financial aid, or work while they are in school.
Apart from researching online study options, prospective students can apply for college scholarships and grants or participate in work-study programs to pay for school.
Credit and Debt
During a recession, families must still pay the household bills, and try to get out of debt. Bankruptcy, court judgments, and late payments can all hurt your credit score.
Your credit history impacts credit card and loan interest rates, insurance and mortgage rates.
Survival Strategies:
Families should prioritize expenses and pay bills in order of importance. Some bills can be paid late, but other bills must be paid on time in order to avoid eviction, or a school year loss.
Recessions can lead to a reduction in borrowing, and families may become more fiscally responsible following an economic downturn. Less debt and more responsibility can lead to smarter money management, and a stress-free financial life.
Determining Necessity
Families must understand the difference between needs and wants during a recession. Families need a safe place to live, clothing, food, and access to affordable health care. As priorities shift for many families during an economic downturn, they can focus on the necessities, and learn more about their innate survival skills.
Survival Strategies:
Learning how to prioritize expenses, adapting to a loss of critical income, and making lifestyle changes will be hard. Families can cope during this period of adjustment by relying on each other, becoming a true support network. Celebrate successes as a family, and acknowledge each others’ efforts to become solvent. Take control of the situation to reduce the negative impacts of the recession, and to set a good example for the rest of the family.
The effects of a recession on families lasts a lot longer than the duration of a recession. Ultimately, almost everyone from the younger kids to the retired family members suffers during an economic downturn. Families can survive by adapting to a new lifestyle, working together, and making changes to improve their future.
Has your family been impacted by a recession? What strategies have worked well for you in trying to dig your way out?
