You’ve worked hard all your life to build wealth for yourself and your family. Don’t let a recession take that away from you! Foresight, planning, and hard work can ensure that your savings say safe in even the toughest of economic climates — but taking action is a must. Here are four important steps that you can take to help recession-proof your life.
- Build a Liquid Emergency Fund. Saving in any currency is obviously not a solid long-term wealth-building plan. However, having a reasonable amount of savings in cash is important because it allows you to respond quickly and efficiently to emergency situations without needing to sell assets quickly (at a low price) or take out loans (at a damaging interest rate.)
- Diversify Your Investments. So if saving in currency isn’t the answer, then what is? Wealth is best stored in a diversified investment portfolio, which allows you to grow your funds at a rate that outpaces inflation. A good portfolio should include stock in many companies from varying industries, as well as mutual funds and other highly stable assets such as gold, silver, and precious metals.
- Live Within Your Means. It’s a lesson that you’ve always tried to impart to your kids — and it’s one that you should follow, as well. Spending less than you earn may seem restrictive at times, but over the long haul it will give you a great deal of financial freedom.
- Cultivate a Long-Term Mindset. Panicking over short-term setbacks is one of the best ways to wreck havoc on your portfolio. (Not to mention your blood pressure!) Here’s a good example of why this is: in November of 2007, the Dow Jones was at a record 16,242. By March of 2009, that number had plummeted down close to 8,000. Those who panicked and sold off their stocks oftentimes lost as much as half of their wealth! Today, as of April 2017, the Dow Jones is above 20,000, rewarding those who had the patience and foresight to hang on to their stocks.
Looking to protect yourself against the volatility of the markets? Investing in gold is a fantastic way to do just that. Visit Red Rock Secured online to learn how.
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