Our economy is in a recession period, and it is making people nervous. They are tightening their belts, and doing their best to make their money go further. A recession can lead to hard economic and financial times for many, and in some cases results in job loss, loss of homes, loss of retirement accounts, loss of education savings plans, and more. It is no wonder that when the word "recession" is in the air people get overly worried. History has shown us that recessions can lead to depressions. So, business owners are cutting back employees, and people who are barely making ends meet as it is are letting their homes go into foreclosure. It seems right to be nervous, but the fact is that you do not have to watch your finances and assets go up in flames just because it is a recession, there are some things you can do to survive this recession, and to help yourself be better prepared for economic hardship.

Step one is to not panic: It is a natural response to cash out investments, take your savings out of the bank, and stock up on things you may need when you hear the word recession. However, runs on the bank, and widespread panic tend to cause further problems rather than alleviate the ones you are seeing. So, it is important that you recognize that while the economy may be going downhill, you do not have to let it send you into panic mode.

Step two is to learn how a recession will affect you: While it is a bit scary to watch the economy fail, it does not have to affect you as badly as you think, especially if you learn how to prepare for the areas where it will affect you most. In most cases a recession is going to affect people monetarily. However, also in most cases, practical, and basic monetary advice can help you survive a recession. Having good financial habits before a recession make it easier to survive during one. If you are not already practicing good financial habits, now is certainly the time to start. Be sure to do the following:

• Pay off debts, and do so aggressively.
• Have a fund set up for emergencies. This should ideally be 3-6 months worth of income.
• Save money.
• Pay your bills on time.
• Pay bills before spending money on entertainment, and variable expenses.
• Never spend more than you have.
• Live within your means.

Okay these are all things people know, and yet many people find it fairly difficult to get out of debt, and quit getting into it, etc. However, during a recession, especially if times are hard and only getting harder, it is crucial that you practice these good financial habits so you do not end up in financial ruin.

The next step is to protect your source of income: It is going to be hard, but not impossible to survive a recession if you lose your employment. However, if you take steps to ensure you are a valuable resource, chances are you won't lose your job. History has shown that those who are able to maintain a steady source of income during a recession have a far better likelihood of exiting the recession in a good place financially. The following are a few things you can do to help make yourself a valuable enough asset that you won't have to worry about layoffs.
Increase your education level. If there are people in your line of work with better education, or more certifications than you, you may be laid off before them. So, when possible, seek to increase your value through getting more education.
Be friendly. If your boss likes you it is going to be really hard for him or her to lay you off. As silly as it sounds, people get ornerier during a recession, they get worried. Do not be one of the people that come to work with a scowl, instead, be the friendly face, and the one with a happy greeting. Give them no reason to not like you.
Work harder, and work longer. If you are the last one into the office and the first one to leave each day, then when layoffs occur, you will be the first one to go. Instead, show your commitment to the company by not milking the clock, not taking extended lunch breaks, and not coming in late, etc. Instead, work hard and get noticed for always going the extra mile.
During a recession, layoffs are sometimes unavoidable. In order to best survive a recession, make sure that you are aware of the fact that you may lose your job, and thus, keep your eyes and ears always open for other opportunities. Also, be sure that you keep your resume updated. Also, make sure that you are keeping connections with friends, and others who may be able to help you find a job if you lose yours.

Another option for helping you to better survive a recession is to start looking for alternative ways to add to your income, this may include doing things like your hobby, but for money. If, for example, you are good at something, you may want to see if you can use it to earn money. If you do not have skills or talents that you feel would work as a way to earn extra money, consider taking a class, or getting some books to learn something that may help you make ends meet when times are tough, this could be mending, wood working, computer repair, etc.

The next step to surviving a recession is cutting back: because there is a chance that you may lose your income, it is important that you make the money you do have coming in go further. It is also important that you are able to reduce expenses so that you can save more money. If you are currently spending more than you make, cut it out. If you are left at the end of the month with very little money in your bank account, then start looking for ways to cut costs and have more at the end of each month.

Start by looking for ways to cut your monthly recurring expenses. For example, you may want to refinance your mortgage as during a recession rates are typically low, and you can get a smaller monthly payment by refinancing to a lower rate, just make sure it is a fixed rate. Another good way to cut recurring expenses is to cut back on services. For example, if you pay for television service every month, you can get a less expensive service package with fewer channels. Look for areas where you can eliminate or cut back costs. One of the best places to do this is on your credit cards. Credit card debt is expensive, and carries high interest. So, pay on time, and work to aggressively pay those cards down to zero so you are not throwing money away. In the meantime, it is a good idea to contact your credit card company and negotiate for lower rates. In addition to that, quit using the card so that you are not accruing any more debt on it.

The next step to surviving this recession is to ride it out, especially when it comes to your investments: First, it is important to understand that while the stock market is having significant ups and downs, and you are watching your stock value go up then fall dramatically, pulling your money out and sticking it in a savings account is really not going to solve the problem. Instead, try converting your investments to things that are less affected by recession, such as mutual funds. Also, know when to hold and when to fold. For example, if you have money invested in a rather unstable, smaller company, it is going to be smart to sell, especially since they could go under. However, if you are invested in larger, more stable companies, it is often best to simply ignore the markets and exchanges until the recession is over. If you were not planning to use the money from your investments right away, then leave it alone during a recession. There is risk no matter what you do with your money, so if your employer is contributing to your 401K, etc. then let them keep doing it, and just don't look if you can't tolerate it. Panic selling is unwise.

If you have money to invest during a recession, consider purchasing hard assets and things that are not as effected by economic downturn, this could be things like real estate, that while it takes a hit, it will not decline as rapidly as a stock might. 

Last, but not least, if you want to survive this recession, you have to have a positive attitude. The recession is not going to last forever, but if you can get in the practice of eliminating debt, stretching your dollar to go a little further, and securing your employment, as well as doing things to better yourself, you will never regret it. Think of the recession as a chance to better yourself, and as a way to force yourself to be better with finances, coupon clipping, etc. You may find that this recession is going to better prepare you for when you do have wealth, and for when the economy is great. You will know how to stretch your dollar further, and how to manage your finances better.