Preparing for Financially Hard Times

How would one prepare for financially hard times?

1. The breadwinner(s) in the family should make every effort to stay employed and keep earning wages or salaries, profits, and benefits.

2. Try to build tenure or seniority with your employer, and demonstrate both creative and productive skills.

3. Keep knowledge and skills current through continuous upgrading; thus, you can compete with the best and offer the best service or product available in your field. Even family members not employed should do the same. Where possible, everyone should have or work toward a potentially marketable skill or product.

4. Protect yourself during a recession—or times of inflation—by keeping monthly expenditures well under control. It is no time to have any excessive debt or large installment payments. Also, you may not be able to borrow money for major things like houses, farms, or businesses. Wait until money is more available and the interest levels are moderate.

5. Have an emergency cash reserve. The longer or deeper the economic downturn, the greater the need for ready money in such cases as unemployment, reduced income, illness, or injury.

6. As much as possible, get ownership and clear title (or deed) to cars, major appliances, homes, farms, businesses, etc. During a recession or depression, repossession, foreclosure, and garnishment—and the resulting risk of bankruptcy—are more likely since cash demands continue and income may stop. Ownership of your major possessions would provide you with great security.

7. Have an adequate supply of food and clothing. It takes most families months and even years to build a good supply and learn how to store and rotate it properly. Get started now.

8. Be willing to make significant life-style changes. Economic hardship could force you to sacrifice many comforts and luxuries such as recreation, travel, nonessential clothing, eating out, entertainment, and gifts; can you make some of these changes voluntarily now? Expenditures might have to focus on essentials such as food, housing, utilities, health care, and transportation.

9. Organize your extended families to give help to each generation as needed.

10. Self-reliance is important. Knowing how to make bread, sew clothes, make gifts, toys, and home decorations, paint the house, fix the plumbing, etc., will become increasingly valuable. As much as possible, be able to sustain life. Grow a garden, cultivate fruit trees, keep animals, etc., wherever practical, or have access to these resources.

One of the best defenses against a recession or a depression is owning things like food surpluses (such as grain, sugar, corn, rice, beans, and dried fruits), precious metals and gems, coal and wood, land, etc. They have intrinsic value, demand for them stays high, and they can be used in many ways.

11. Be good friends and neighbors. During hard times, you’ll be exchanging products and services much more.

Source: Ensign, "Questions about Coping Financially: Welfare Services Suggests Some Answers," June 1980.