Recession is the act or an instance of receding or withdrawal. Economic recession is a period of a reduced economic activities. Just a couple of weeks ago, the Governor of Central Bank of Nigeria warned that Nigeria was at the verge of sliding back into recession again after the nation was declared to have survived the menace some months ago.
Meanwhile, our major focus here is to outline practical steps to survive in this period of excruciating economic realities. The following are some practical steps to cushion the effect of the obvious hardship during this period:
1. Set up emergency fund. A two – income couple should keep between three months worthy of expenses in an emergency fund under normal circumstance but should be increased to six months during a recession. In the same vein, the principle applies to corporate bodies such as financial institutions and construction which are hard hit during a recession.
2. Try and pay off your debts, especially those with high interest rates such as credit card. A wise saying says ‘’debt begets debt.” Gradually reducing your debts will lower your monthly expenses and position you to survive the harsh economy.
3. Invest in valuable securities with low prices e.g. shares and stocks and could as well diversify your stock portfolio to reduce risk. You can purchase bonds and securities from other countries to reap foreign dividends; invest in real estate such as land or landed properties and resell at higher price later on. It is pertinent to note that prices of these items usually falls in a time like this as some people would sell to pay their wards school fees or to sort out pressing personal and family needs.
4. Create multiple streams of income while on a paid job. Don’t take your job for granted as companies would always look for ways of reducing expenses by cutting jobs to be able to survive. Endeavour to keep your job but keep an updated CV and always think ahead of opportunities. Look out for online businesses or any passive income as an additional N10,000 or N15,000 in a month would go a long way in saving you a financial embarrassment in time of need. You can do a consulting job depending on your area of specialty to boost your income.
5. Invest in agriculture such as poultry or plant vegetables, tomatoes and pepper at your backyard or in pots placed on your balcony or any suitable space in your apartment. You can engage in fisheries in big bowls covered with nets. The produce could be used domestically or sold to the local market women and get some cool cash.
6. Sit down with your family, itemize your monthly expenses and harmonize your spending. Try and live within your income. Reduce your expenses by cutting out extravagant expenses i.e. no partings, aso ebi should be reduced drastically if not eliminated at together. Cut discretionary spending, avoid impulse buying and resist sales pitches such as ‘’buy one and get one’’ stuff to pull money out of your pocket. Reduce fuel cost by cutting down on non-essential visitations and be an early riser to reduce transportation cost. You may as well make use of low cost means of transportation such as BRT and water if you live in riverine area if you work in Lagos.
7. Stop going out to eat instead try and cook at home except when necessary especially at work. Buy your food items in bulk from a local farmer’s market where you get them at considerable low prices compare to the neighborhood.
8. Avoid standing a surety for a debtor during recession otherwise you may end up becoming the debtor yourself. Give a little you can but be careful in borrowing to a friend or relative especial if unemployed otherwise the relationship could be marred.
9. Maintain a low profile life style in your neighbourhood to avoid jealousy and possible attack.
10. Sell off disused items/assets locally or online to boost your finances.
11. Invest in your future and that of your children by ensuring that you pay their school fees and keep to the education insurance or schemes for them.
12. Maintain a healthy life style and balanced diet to reduce or even avoid sickness that could lead to incurring hospital bill. Engage in regular exercises, take plenty of fruits and water to keep healthy.
13. Children who are of age should be engaged to do some house chores such as cooking and laundry instead of having to pay people to do them.
14. Engage in handiwork or crafts which you are passionate about some which may require a little or no fund to start up e.g. soap making, fashion designing, hair platting, event planning or decoration, rentals of chairs and canopies for events, motivational speaking. I know of a woman who is a school Teacher who engages in ‘’Alaga Iduro/Alaga Ijoko’’ during wedding marriage engagements. Discover and develop your talent and make use of it for monetary returns. Don’t be lazy but get yourself engaged in a productive venture. Some people who are on paid employment and private businesses doubles as agent or middle-man to disposal of property or valuable items to increase their incomes.
15. Lastly, always pray for God’s sustenance.
Bottom line
You may not live a Monk’s existence during a recession but should pay extra attention to your budget and spending and avoid taking unnecessary personal and business risks. I believe no one needs an MBA from Harvard or a degree in Economics to do
that.
Olumide Ojo is a life coach and public affairs analyst. He can be reached via his email: olumideojo028@gmail.com
