Recession Coming? Here’s What to do...

Unless you have been in a long long vacation where you can’t get any news…you’ve heard that a recession is coming. Every news is covering how our rebound and good standing have been too long in standing, and now, it is due to a correction.

You may think… why is there a due correction? What is that about? Well, that is because it has been historically proven that we have 9-11 years between each recession. Also, as you all know everything that goes up must come down (like a sale) in order to move forward. And when it comes to the market… it needs to come down to “correct” (not be so expensive) itself because its been really high for a long period of time.

So what is a recession? A recession is when two or more consecutive or continuous quarters are in the negatives. This means that business sales and revenues decreases, businesses stop growing and hence people may lose their jobs, prices may go down (or at times stay the same), and people’s income stay the same or decrease.

Of course, this is a concern for many since as we all know that many of us spend more than what we make and don’t have a lot of savings in our banks. This may mean that many of us may be hit hard during these coming times and hence we want you to prepare for it.

Here are things that you can do to stay ahead of the curve beyond saying your “pennies” as many are recommending:

1) Lower your expenses - its always a good time to lower your expenses. But this time is particularly important. Since income may be at risk, you want to make sure that you are at your bare minimum in case you lose your job or have an emergency that your job’s income may not be able to cover it. Let go of the frills or the wants and stick only to the need. Then stash the extra cash into your bank account.

2) In case you don’t have any savings, please start being aggressive with this. Make sure that you are saving at least 10% of your monthly income (not yearly - monthly). Place an automatic transfer of the amount to your savings and don’t look at it or touch it.

3) Get a side gig - start looking for additional review streams so that you are not only dependent of one. Note though that there are some that pay faster than others. So do you research carefully before committing to one, and they should be low cost.

3) Create an Intentional Plan/Budget and stick to it. This is no time to go with the wind. The wind will sail you to troubled waters.

4) Pay as much as you can your debt. The less debt you have, the better you will be when the recession hits. By the way, if you cant pay off the debt, make sure to pay off your minimum payment until you are able to pay more.

5) Kill complacency - If you can, start looking for new higher paying job so that when the recession hits, you are already in a better position. Just note to make sure you jump to a reputable company that will not be affected by the recession as much. DO YOUR RESEARCH CAREFULLY! Why? Because this ensures that you do not lose your job (usually the last ones hired, are the first ones fired in lay offs - of course there are exceptions to the rule), and you want to make sure that you are not only increasing your salary but also keeping your job.

6) If you stay in your job, start managing up and letting your management or any stake holders know your value - what you are contributing to the company’s bottom/your department. The more people know how valuable you are, the better. Also, build stronger relationships within the organization. Let’s face it, people keep the people they like even if they are not producing. Yes, it is sad, but oh so true. This is not the time to skimp on those group lunches or outings.

7) Network Your Ass Off - I know, I know, I know… network may not be your fortay or you may feel a little bit weird about reaching out to people now. First do it eloquently. Do it with them in mind and bringing them value. Don’t just reach out to reach out. This is a waste or your and the other person’s time. Now that we’ve established how… here is the reason - because if you lose your job you can reach out to them and they can help you with an opportunity. Usually people wait until they have lost their job to start the networking. This is too late and a big mistake. There will be so many people out there doing the same that will be hard to get something if you did not nourish the relationships previously.

8) Use LInkedIn like your life depends on it. Start posting articles, research, or any other pertinent information for your contacts. This is a sure fire way to keep involved and connected within your industry. But a word of caution - don’t depend too much on it that you forget the most important connection - the face to face. Make sure that you are also having face to face conversations/meetings with people.

9) Check your investments and make sure that they are rebalanced to showcase the coming times. Or, and I know many will scoff at this, lower your payment towards your investments (lowering is the operative word), move that money into savings and never touch it. Why am I saying this? Because cash as always is king, and especially during a recession and you will need it more than future stock earnings (especially 401K which you won’t get until 65+ years old).

If you know of any other tips that have helped you in past recessions, or you have any questions, email me up at financialdivasgroup@gmail.com. I can’t wait to hear from you!!

XOX,

Clara

Cash is King

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We’ve heard the saying…

Cash is King. And yes, it is true, cash is king.

But Cash is also a strong motivator to not use it as often. You see the more you use cash, the less you will like to use it. I’m sure you are scratching your head right now, saying “What?” No I don’t.”

But think about it, the last time you used cash to buy something and you see the money going out your hand, how do you feel?

All of the sudden everything seems expensive (yes, even a dollar item) and you want to keep the majority of it in your pocket. So you think twice about the purchase, you ask is this really necessary (in which most of the time, you take things off your cart at that point), and then you only buy what you can.

Therefore, cash is definitely king. It controls and helps us at the same time. It quickly helps us access how much we truly have, in what we should truly spend it on, and how much we want to keep it.

This is the reason why Financial Divas use it more often until they are debt free and have learned the basics of financial literacy. They know that they have to put away the credit cards and commit to cash for their well being.

Next time that you go out, make sure to use cash for it, and you’ll see how cash is king. :-)


Your Financial Adventure, Starts Here...

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Do you know

🤑Where you are going?

🤑When you will get there?

🤑How you will get there?

🤑Why you are going there?

🤑Who or What will help you to get there?

The answer to these questions are at the starting point of your financial adventure.


Let us guide you through our easy steps in our financial challenge. Become a member (it's free!) and get the small steps to take everyday to start your journey in the right direction.

The Day After Filing Your Taxes

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It’s the day after

filing your taxes, and what are you do to make sure that 2019 is a tax success?

First thing is first,

✴️ Check what pinned you - what made you pay more and plan accordingly for this year to avoid this as much as you can

✴️ Organize & have All Paperwork Ready (early)- As the year goes on, have a separate folder for all paperwork corresponding to your taxes

✴️ Check to see what is your tax bracket this year - you do this by going to the IRS site and based on this year's gross income you estimate where you will fall next year

✴️ Plan accordingly to your tax bracket and speak to your tax advisor on how you can lower your taxes this year

✴️ Check which expenses to pay in full and which ones to pay in installments. You can ask your tax advisor about this. Usually when it comes to medical expenses and business memberships we pay it in installments. But sometimes it is best to pay it off by year end because you may be able to write off more. Talk to your tax advisor and see which method and for what will help you most based on your tax scenario.

✴️ Contribute to your retirement accounts throughout the year

Today is the Day- Tax Day

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Oh Happy Tax Day!

Today is the day.

Today is the deadline for filing your taxes!

And hopefully you get a return back or don't owe anything.

What we prefer is that you don't owe anything because that means that you did not give the Federal Gov a free loan with your money, and that means you planned your taxes amazingly well.

If you are in this category -CONGRATS!

But, if you are receiving a return, still good!

Here are the many ways to utilize your taxes (and no the list does not include to use it or a vacation- sorry but not sorry):

1.🚩 Pay off some debt

2..🚩 Automatically transfer it to an online savings account with a high interest rate (yes, you may need to open a new account, but if that means more in your pocket, then so be it)

3. .🚩 Save it in your emergency fund

4. .🚩 Pay off all or some of your rent - this will give you some wiggle room and less worries - also you can you the saved rent money into paying off your debt or saving it (you see the where we tie it back to...lol)

5..🚩Use it to pay off school tuition or to get a certificate or accreditation so that you get paid more in your job/venture

6. .🚩Put it into your 401K, IRA, RothIRA or any other investment

Remember the point of your taxes return is not to use it as a vacation savings account, rather use it correctly and to catch up on any expenses that you were not able to afford.

The Day Before You File Your Taxes

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On the day before you file your taxes, the federal government gave to meee… (sing this with on the 12th days of Xmast tune and you’ll remember this)

Nothing.

The federal government doesn’t want to give you anything and instead prefers that you pay of course. Therefore, it is up to you to make sure that you have planned for your taxes correctly and that you are not owing them anything.

But a day before you file your taxes, what can you do?

  1. See if contributing to your IRA/RothIRA will help you reduce your tax bracket

  2. Review all your records, and make sure you have all the corresponding back up and correct statements

  3. See if you will be able to get a slot to see a tax preparer (it might not be the case, but you never know)

  4. If your are doing it yourself, make sure that you review and answer correctly every tax form and question before submitting your taxes

  5. If you don’t have one already, open up a saving accounts with a high interest yield percentage and include that routing number and bank account within your tax forms. This will ensuret hat any refunds will be deposited to an account that will help you not use it (because its out of sight, out of mind)

  6. 📌File an extension. An extension will provide you with the ability to file until October 2019 at no cost to you. It will provide you with additional time to gather all the information you need to make sure that you get your maximum return.

    📌One thing to remember, if you owed last year and think you may have to owe again this year, then keep in mind that you will still need to pay the amount but IRS will charge you interest for everyday that is late. So try your best to do the taxes as soon as possible from the extension (or if you can avoid it all together). 

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