How to Get your Personal Finances Ready for a Recession

Australia will head into a recession in 2020.  Our economy has basically been ground to halt thanks to Coronavirus.  So how can you prepare?  Here are some of the things I’m going to be doing to make sure that I’m in good shape to get through a recession:

Setup Your Emergency Fund

An emergency fund is stash of cash that is easily accessible in an emergency.  While investing your money in stocks is great – it can take a number of days before you have access to that money.  Furthermore, you don’t want to put yourself in a situation when you need to sell stocks while the market is down.

I keep my emergency fund in a savings account.  While the interest in these accounts is basically none – it’s still better than nothing.  And I have been using Volt, a Neobank with higher interest rates.

I contribute to my emergency fund on a weekly basis.  My ideal goal is to have enough money to live off for a few months.  But currently I’m setup so I can easily pay for any unexpected bills, medical costs etc.

Do a Subscription Review

Nows the time to look at all the things you’re subscribed to and see if you can cut any of them out.

If you’re out of contract with your mobile, internet or energy company – take a look at their website.  You might be paying more for a plan than you need to.  I’ve found (especially with my mobile plan) that plans get more generous over time.  So you can often pick up a cheaper plan that has the same features as your current plan on the same provider.  You just need to make a call and asked to be switched over.  Energy companies also offer special deals if you sign up for a certain period.  You won’t be automatically signed up for these, so again you’ll need to go to the website and sign up.

If you want to be even more thrifty – you could look at switching away from your current providers.  This often takes more effort.  But you can generally get pretty good deals for new customers.

Also look at all of your TV, Internet and Music subs.  Make sure you’re not paying for things that you never use.  Many of these services let you cancel without any hassle, so why not try living without them for a month and seeing how you go.  You can always sign up again if you can’t live without it.

Practice Dollar Cost Averaging

With a recession, it’s going to be impossible to know when the “bottom” is in.  So instead of trying to time your investments, a smarter strategy is to invest smaller amounts at regular intervals.  This is known as dollar cost averaging.

I like to do this through Spaceship and Raiz

Tip: Get $5 free on Spaceship when you use this promo code during signup.  Get $5 free on Raiz when you signup using this link.

Investing during a recession will ensure that you’re not buying into the market once it’s recovered and recorded new highs.   If possible you want to buy stocks when the price is lower to maximise your gains.

Setup a Side Hustle

Having a second source of income is always going to be super useful when during a recession.  My side hustle used to be blogging – but it eventually turned into a full time job.  Here are a couple I recommend:

Online Surveys

You can make around $100-$200 a week from online surveys.  Sure, most surveys are pretty dull, but it’s something you can do while sitting on the couch.  And as we’re not going out anymore, why not use the free time you have to make a little extra cash!  The sites I recommend are Qmee, Octopus Group and Swagbucks.  You can use all three in Australia.


Setting up a blog (that’ll make money) will set you back around $100.  But I think it’s a pretty good investment in your future income.  You can blog about anything from personal finance (like me) to health and fitness, beauty, book reviews, travel and much more.  This is my guide on setting up your own money making blog.  If you’re looking to get started – you can get a blog setup in about 10 minutes on Siteground, my platform of choice.



This post is for educational purposes and should not be considered as investment advice. This post is based on individual experience and journalistic research.

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