Thursday, April 26, 2018

Preparing for the Next Great Depression in 2030

Millenials (I think I might be a xennial??) will be hit the hardest during this possible future depression. They’ll be in the height of their careers, earning the largest salaries of their lives. To add more insult to injury, many of us will still have children at home to care for. Our children will be 16, 14, and 12 in 2030. They’ll be eating A LOT of food at that point, and dreaming about college. Preparing now for future money problems will help secure their futures. 
Economists have been wrong before, but why take a chance? We have 12 years to prepare our families and our finances for potential economic disaster. And if it never happens? These little things that you can do are good practices for any frugal-minded person. We’re not talking building a cement shelter in your basement, here. If there’s not financial crisis in 2030, you’ll still find yourself with some important skills, a fatter wallet, and your dignity.
I am in no way a financial expert. These are things that our family will do just in case. Consult an expert for help with financial planning. 

Preparing for the Depression of 2030

1. Avoid all debt

Not having debt is something to strive for everyday, but it’s especially important in times of depression. Student loans can linger for years, and credit card debt can sneak up really quickly. Plan to pay off student loans in the next 12 years if possible. Reduce your everyday spending if credit card debt is racking up. Here’s an article from US News with other suggestions for paying off debt.

2. Plan to get rid of your mortgage

The collapse of banks and the subsequent decrease in income left many families homeless in the 1930’s. They struggled to make mortgage payments with salaries that were about 40% less than a few years before (source.) If there is a future depression, not having a mortgage to pay would benefit you greatly. That might seem completely un-doable right now. If that’s the case, consider downsizing. Tiny houses are big right now, because– clutter.
Plan your moves carefully. Nate would like to move to a part of the city closer to his work at some point. Thinking about a possible economic depression means that we would make that move sooner rather than later so we could either pay off our mortgage, or at least have a good chunk chipped away by 2030.
If you are a renter and don’t plan on buying a house, put aside more than the recommended 6 months emergency fund.

3. Learn how to garden

Maybe you’re not a green-thumb type. The good news is that you have time to learn how to grow your own food. Plant vegetables with high yield, like squash or tomatoes.

4.  Make things from scratch

During the Great Depression, store bought items were luxuries. People turned to making food items and other things from scratch. Think about the staples your family enjoys that you could make on your own. This is something that I love to do, from snacks for kids to hand soap.
An #economic depression is predicted for 2030. You can start preparing your #family now.

5. Learn how to sew

Millenials are embarrassingly weak in this area. Many millennials can’t hem pants, sew buttons, or mend clothing. Or, maybe they (we?? I don’t know) just don’t want to. Learning how to sew can save you money on alterations and prevents you from having to toss clothes that could be saved. I rely on my mom way too much for sewing fixes! It looks like I have some sewing practice in store!

6. Build your community

Many of us don’t live very close to our families. This is really hard in times of need! Build a community of friends-like-family that you can rely on and fall back on in times of need. Or better yet, live near your actual family!
7. Have an emergency food kit
An emergency food kit kit might sound a little over-the-top. They are kind of pricy, after all. But really, anyone could be in a situation where they need food, but they’re trapped at home. The east coast gets hurricanes and crazy snowstorms. Currently, a massive snowstorm with frigid temperatures has settled over the east coast. I would not want to leave the house, if I were there! An emergency food supply could definitely come in handy. And if a natural disaster doesn’t strike, you’d have some meals if the grocery budget gets extremely small.

8. Learn a skill

During the last recession, architecture took a huge hit. People weren’t asking for buildings to be built during a time of less. If your family relies on an income from a non-necessary skill, then you might want to learn a trade that could always be useful. For example, if you do know how to sew but not many other people do, you can help others and help support your family with your sewing skills. My super handy husband could work as a handyman. What skills do you have now, or could you learn, that would help you in the event of an economic downfall?

9. Get resourceful

When we live in a season of plenty, it’s easy to forget that we can get creative with what we have. During the Great Depression, people often replaced the worn soles of their shoes with rubber from tires. I’d love to see the DIY blog post for that! You don’t have to hang onto every plastic baggie you’ve ever bought (which is what my depression-survivor grandparents did), but learning how to reuse or repurpose everyday items can help you spend less now and be prepared for the future. Also, part of resourcefulness is buying quality products that last longer rather than throwing out something cheap in a few months.

10. Invest your money

With all the money you’ll be saving by gardening, making things from scratch, and living mortgage free (I dream big!) you have some room to invest. Investing instead of just saving money is a better way to prepare for an economic downturn because the value of a dollar will decrease in the future.

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