Top Tips On How To Recession Proof Your Finances
Image by Pete Linforth
In light of the news this morning that the UK has fallen into recession, John Westwood Group Managing Director at Blacktower Financial Management Group
has listed 5 top tips on how to recession proof your finances:
1. Stop using your credit card
Now is the time to stop spending on your credit card bill and clear any debts you may have. If you’re paying any interest on your credit card, switch to a 0% balance card, this will give you in some instances 30 months to pay off debts without any interest.
2. Build an emergency cash stash
It’s important to build up a rainy day fund that you can fall into if you face any unexpected costs. We advise to build up an emergency fund that’s at least three months of your outgoings, so add up your bills and essentials to work out how much you will roughly need.
3. Cut your spending
Identify the ways you can cut back on your outgoings, and have more control over your spending. One tip is to write down all your monthly expenses and do some research to see if you can get better deals and cancel any unnecessary subscriptions.
4. Consider your credit score
Your credit score may be the last thing you think about but its important to keep this score as high as possible. A recession causes credit markets to tighten so its important to pay bills on time and keep credit cards open even though you should try to avoid using them.
5. Safety proof your savings
Its important to ensure your savings are protected by Financial Services Compensation Scheme (FSCS), this will cover your savings up to £85,000.