SENSEX down! NIFTY down! The stock market is in a bloodbath!
Me: So what? I never had any money in stocks. Idiots put money in stocks.
Recession is no joke. It will impact everyone on the planet.
- Salary will be cut | Jobs will be lost | Day to day items become costly
- Companies go bankrupt | Inflation
- Govt will be on pressure — no betterment on roads, infrastructures, hospitals.
Not exactly. Recession is also once in a lifetime opportunity.
Some industry will gain when the world population is self-quarantined.
Practical Recession Survival Guide
The digital world will become the real world. Tourism will be the most affected industry, better stay away from it for time being.
It’s not the best time to switch job. The job market will get harder.
And try not to get fired, most companies are going to cut back on employees, because of recession. Create dependency on the work you do. That’s how you become a highly valuable resource.
And be prepared before a layoff. Be active on LinkedIn. It’s about creating a personal brand. Put out content. Send that invitation request to HR. Update your CV. It’s just Instagram for work!
Best time to invest?
Honestly, I don’t know. Nobody knows! It’s not possible to predict the bottom of the market. But a lot of money could be made if you invest correctly.
Everything is on sale for a discount. But don’t go into the market without learning. And don't burn your emergency fund for buying into stocks. No one knows when the market will rebound. Invest only what u can afford to lose.
- Don't invest in lumpsum | “Dollar-cost averaging strategy”
Let’s say you plan to invest 10k to invest, don’t buy stock for 10k in a day.
Day 1 when you see the market in red blood, invest 2k, then see how the market moves in the coming days then invest next 2k.
- Search for companies that are down only because of corona fear.
Example IRTC: is down because the whole country is in lockdown. This will have an impact on the quarterly profit of railway but eventually, everything will return to normal and people will travel by train.
- Don’t invest in the hype, unless you know what you are doing.
Example YES Bank: Bank fails, stocks freefall to single-digit and couple of days later govt decides to bail them out. Stock skyrocket.
- Invest in zero debt companies, during a recession those companies perform well.
- Invest in market leaders. Each category have the top player, they will have enough cash to burn through the recession. Right now their stocks are on sale for a discount.
Public sector banking: SBI
- Invest in companies that benefit from corona crisis.
For example Pharmaceutical
- Explore alternative investment :
Gold, Silver, Crypto, there are lots of options.
A small misconception many have, by investing in gold or similar commodity you don’t have to buy physical gold. (This is just one method)
* Gold mutual funds
* Paper gold
* Gold exchange-traded funds (ETFs)
You can even buy gold on Phonepe and Paytm.
Take a loan
Do this only if you can handle it. Interest rates will be slashed during the recession. Take a loan and generate cash flow for paying up the loan.
Buy a house on loan, rent it out. Payback the loan from rent money.Invest in yourself
Invest in yourself
Do what your future self would have wanted you to do today.
- Learn to cook: Cooking is an essential life skill. If you are away from home, in lockdown you already know what I’m talking about. Plus it's healthy and saves you lots of money. Open zomato and see the last one-month bill, see how much you could have saved!
- If you are in IT, you already know how to skill up. Buy that course or go to Youtube and start learning a new tech stack.
- Get fit: Always wanted to make the gym a routine but couldn't because of work or college? Happens with everyone. Literally everyone.
Lockdown is the perfect time to create the habit of working out, thousands of apps available on home workouts. Get into the habit of exercising.