Back in 2012, when I quit my day job, I had to brace myself for potential economic hardships, as I no longer had a safety net. My biggest fear was failing and having to ask for my old job back, which would have been incredibly embarrassing. Plus, I never wanted to relive the struggles of past economic downturns—those who weren’t around for the previous financial crises should consider themselves lucky!
Mentally preparing for the worst can actually make you happier and less stressed if tough times do hit. And if the economy bounces back, you’ll feel even more grateful for the easier times that follow. But even if disaster doesn’t strike, there’s a silver lining. You might have to deal with lower returns from a conservative investment strategy, but at least you’ll still feel on top of the game.
One unexpected perk of economic downturns I’ve noticed is the reduction in road traffic. After I quit commuting in 2012, life was blissful without the rush-hour jams. However, when my son started preschool in 2021, I was back to navigating through daily traffic, dealing with double-parked cars, and other commuting headaches. It’s ironic, but true—deep recessions reduce traffic because fewer people have jobs to commute to, and high vehicle costs discourage driving.
When the dot-com bubble burst, downtown San Francisco was eerily quiet, and you could walk into any restaurant without a reservation. Fast forward to now, and it’s bustling again, much to my dismay. These shifts show how economic cycles affect everyday life, including where we choose to work.
Speaking of work, many of us dream of careers that fulfill us, like working in publishing if you love books. Yet, the high cost of education often pushes us towards more lucrative jobs in tech or finance. At Facebook, for example, the pay was great, but as an English major, it wasn’t fulfilling. The stock market crash was a wake-up call for me, prompting me to finally chase my dreams in publishing.
Economic downturns also present a good opportunity for our children to invest, as they can buy stocks or even real estate at lower prices, setting themselves up for future financial success. Personally, I’ve shifted my focus towards investing in private growth companies, particularly in the AI space. It’s a sector that holds promise for significant future gains.
The lack of affordable housing remains a chronic issue, but recessions can sometimes present opportunities to secure a home at a reduced price. My family benefited from this during the pandemic lockdowns when we purchased our home for much less than it would have cost otherwise.
Economic crises have a way of revealing true talent and potential. Companies streamline operations and become more productive, which can lead to the emergence of groundbreaking new businesses. At the same time, tough times expose those who have been less than genuine, filtering out the opportunists from the true experts.
Moreover, global events like China’s strict COVID policies can inadvertently benefit other countries as they gain economic and market advantages. This shows how interconnected and reactive the global economy is.
Overall, preparing for economic hardship not only makes you resilient but also opens up opportunities that aren’t apparent during boom times. It’s about making the best out of difficult situations and coming out stronger on the other side.
