We hear a lot about the financial crisis that overtook the world in 2008, and everyday we are exposed to more and more of the effects on those around us. With an economic downturn comes job losses, with Australia’s unemployment rate rising to 6%. Needless to say, the prospect of further decline is a scary one for many Australians, but it is certainly possible to prepare yourself for the worst.
You can never start readying yourself too early. Many people only start to prepare when things start looking bad, but by then, it can be too late. We saw it with the global economic downturn in the late 2000s, with people scrambling to make up for lost time, but it doesn’t always work.
A Little History
When the financial crisis hit in 2008, Australia was spared from the biggest brunt of the economic failures. But despite the government stepping in and helping out the Australian people, between 2008 and 2009, the unemployment rate spiked by almost 2%, indicating severe ramifications across the working population of the country.
A lot of the people who lost their jobs were forced into redundancy in the unstable market. The value of many stocks fell and unprepared investors were also in trouble. The market’s crash was unprecedented and we are still feeling the aftershocks.
Since the 2008 GFC, tensions have been high, and the thought of further economic downturn is now in the minds of everyone, not just those in finance and business. Everyone has seen what a financial crisis can do, but there is more to preparation than just a savings account.
Education is Key
Whether you look to a financial planner or are educating yourself, knowing the ins and outs of finance will help you get prepared. Learning about investments and investment opportunities will help balance your portfolio and lessen your chance of losing all of your savings. Do research and learn what investments have stayed safe during past downturns. Property has the benefit of providing basic human need, and healthcare-related investments often remain stable.
But saving does come into it. In the event that you are forced into redundancy, you may struggle to find more work. If you are past a certain age, you might want to consider retirement, but to do so, early preparation is ideal. Research into the best superannuation fund will set you up for the best outcome and keep to a budget in the interim. Whether or not you decide retirement is for you, having a comfortable amount of savings to rely on will give you time to plan your next move.
It’s Never Too Soon To Prepare
Planning for the worst will keep you comfortable no matter the state of the economy. Look to educating yourself so you know the best strategies for investments that will keep you safe in case there is another crisis, and stick to a budget to give your savings and superannuation accounts the best chance at long-term survival. With the right preparation, you can keep your finances safe and yourself secure.
Disclaimer: Information above is not to be taken as advice. Information provided is of general nature and it does not take into consideration personal situation, nor does it take a closer look at particulars of investment avenues. Information above is a general approach to safer investing through research and planning.