MANAGE | AUG 3, 2022

Preparing for Recession

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Rob West & Jim Henry

It’s official. The U.S. has technically slipped into a recession, with two consecutive quarters of negative GDP growth. The question is, are you prepared for it?

God’s Word tells us to prepare for lean times. Proverbs 6:6-8 teaches, “Go to the ant … consider her ways and be wise … she prepares her bread in summer and gathers her food in harvest.”

And in Genesis 41:54 we’re told how Joseph, as overseer for the Pharaoh, stored up grain. It reads, “, and the seven years of famine began, just as Joseph had said. There was famine in all the other lands, but in the whole land of Egypt there was food.”

We don’t have famines in the U.S., but we do have the business equivalent, recessions. In modern times, they seem to come about every 10 years, usually following strong economic growth. So it’s never a question of if a recession will come, only when.

How do you prepare for such a time as this? Here are a few suggestions:

  • Get educated. Sign up for a personal finance newsletter or blog. Christian Credit Counselors has a great blog about debt management and improving your finances in general. Crystal Paine has a daily newsletter with money saving tips and deals.
  • Make a “to do” list. Jot down 10 financial tasks you’ve been putting off, such as checking your credit score. Your credit card issuer probably offers this as a free service. Another tassk might be getting your credit report from AnnualCreditReport.com. You can get one from each of the three credit reporting agencies each year for free. Other important tasks might be to get disability insurance if you don’t have it, or to make out your will if you haven’t already. Keep going until you have 10 items on your list.
  • Do something. Pick one task from your list and just do it. You’ll get a sense of satisfaction when you cross it off. Then make a commitment to do another item each week. You’re much more likely to finish the list if you focus on just one item at a time.
  • Track your spending. When times are tough, you need to know where every dollar is going. You can do this manually with a small notebook where you write down everything you spend, or you can simply have the free MoneyWise app to do it for you. It also has three ways to set up your budget, so one will be right for you. Download it wherever you get your apps. Just look for “MoneyWise biblical finance.”
  • Stretch your dollars. Now that you know where your money is going, identify one area a week where you can trim or cut something altogether. A good place to start is by canceling recurring charges in your checking account for apps or streaming services you no longer use. Odds are you have a few.
  • Prepare your “Mayday Budget.” Determine the absolute minimum you need for four categories: Food, housing, utilities and transportation. Food, because you have to eat. Housing, because you need a roof over your head. Utilities, because you need to keep the lights on and your home heated or cooled. Finally, transportation, because you need to get to work or to look for a job. All other bills are less important and you can catch up on them later.
  • Reflect and meditate on God’s financial principles. The Bible has more than 2300 verses laying out God’s wisdom for managing money, so you’ve got plenty of reading to do. Focus on just one a day, such as Prov 22:7: “The rich rules over the poor, and the borrower is slave of the lender.” If you’re experiencing financial difficulty right now, a good place to start is with Philippians 4:19. It reads, “And my God will supply every need of yours according to his riches in glory in Christ Jesus.”

There are some ways you can prepare for difficult financial times. We hope you find them useful.

You can also listen to the related podcast on this topic.

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