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Ask HN: How are you preparing for the recession?

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Re: Ask HN: How are you preparing for the recession?

#31

Post by rufus_foreman »

I think the thing to realize is that a lot of it is out of your control.

I was working at a startup during the 2007-09 recession. Before that things were going great and they were hiring, and hiring, and hiring.

Then all of the sudden things weren't great. The startup had two products they were working on, all of the sudden they only had money for one. One morning I came into work early and all the conference rooms already had people in them with the doors closed, they axed everyone working on product A and walked them out the door. I was on product B, I was fine.

Some of those people didn't work for almost two years. It was just random. I had quit a software developer job in the real estate industry to work at the startup because I thought it was obviously going to be a bad time to be in the real estate industry. Which it was, but I had no idea that it was going to affect everything else.

Re: Ask HN: How are you preparing for the recession?

#32

Post by BMc2020 »

Get a part-time second W-2 job, now. Show up on time every day for 90 days in a row. Get a non-customer facing job if you can. Warehouse is good, security guard is good. Places that run 24 hours are good places to look.

Get over having to enter your info twice and and fill out a form with the same thing too. This is intentional, it's to weed out the quitters.

Have a folder with everything you need in to fill out an application form in it.

Call the HR at your old jobs to verify the phone number is still correct and what your dates of employment were. Get over your embarrassment, they truly don't GAF and if you left on good terms (two weeks notice) they may ask you back.

Amazon warehouse isn't as bad as they make it out to be, avoid driving amazon and anything else amazon.

TL:DR; Non customer-facing part time job, be perfect for first 90 days.

Re: Ask HN: How are you preparing for the recession?

#33

Post by MichaelBurge »

toomuchtodo wrote: post #6

1. Keep 6-12 months of expenses in cash on hand. Cash. Not SPY, not I bonds, not HELOCs or lines of credit. Cash. When you are in financial peril, you don’t want to deal with a closed credit line, deeply depressed assets, or locked up instruments. 2. Don’t lose your job. 3. Network in case #2 doesn’t pan out. (lessons learned from the 2001 and 2008 crises)

With #1, you count money in a checking account as cash right? Even though it's technically a line of credit that happens to have an insurance policy attached?

Or do you mean strictly physical cash under the mattress(or in a safe)?

Re: Ask HN: How are you preparing for the recession?

#35

Post by toomuchtodo »

MichaelBurge wrote: post #33
toomuchtodo wrote: post #6

1. Keep 6-12 months of expenses in cash on hand. Cash. Not SPY, not I bonds, not HELOCs or lines of credit. Cash. When you are in financial peril, you don’t want to deal with a closed credit line, deeply depressed assets, or locked up instruments. 2. Don’t lose your job. 3. Network in case #2 doesn’t pan out. (lessons learned from the 2001 and 2008 crises)

With #1, you count money in a checking account as cash right? Even though it's technically a line of credit that happens to have an insurance policy attached? Or do you mean strictly physical cash under the mattress(or in a safe)?

Cash in a deposit account is entirely reasonable. Money market funds a bit less so. If FDIC fails, the fiat in the database won’t matter.

Re: Ask HN: How are you preparing for the recession?

#36

Post by lazide »

MrGuts wrote: post #5

A recession is not the worst thing in the world. It's a business cycle, and happens on a regular basis. A recession might (hopefully) chase out some inflation; and it might clarify where some opportunities reside (like new infrastructure, or worker retraining/relocation). A little bit of inflation isn't too bad, either. It helps people pay off debt with less valuable dollars. Bottom line: A little bit of inflation is…

In a macro sense sure. If you’re stuck with a mortgage and kids but no jobs in your area anymore, a lot less so.

Re: Ask HN: How are you preparing for the recession?

#37

Post by sokoloff »

Clampower wrote: post #15

I’d like some advice please. I am currently freelancing with one major client. I only work 3 days a week which is great and I make a good amount of money. Client is a small company, seems financially secure, but eh could also go belly up I suppose. They offered me a fixed contract but it would be for less money than I now make freelancing, +4 days a week. Should I take less cash and less freedom for the security that…

Agree with sibling. If that company falls on hard times, your fixed contract is extremely likely to become a broken contract anyway.

Re: Ask HN: How are you preparing for the recession?

#38

Post by bladegash »

slyall wrote: post #27
sc00ty wrote: post #20

Earlier quoted context omitted.

Could you elaborate on why it's a good idea to start a business in a recession?

Reduced competition. Fewer other businesses are trying to start up at the same time and existing companies have less money to spend to compete against you. Suppliers will also be eager for new business, same with landlords if you have a physical store. Also easier to hire.

Wouldn’t there also be reduced market/customer demand though as well? Guess it depends on the startup and business model, but could see a challenge with actually selling whatever it is your business is providing (e.g., services, product, etc.).

Re: Ask HN: How are you preparing for the recession?

#39

Post by annoyingcyclist »

I have a year of living expenses in cash, several more in low-risk investments. I've been practicing interview skills (but I was doing that anyway). Making sure I have local copies of any personal creds from my work machine – 401(k) login, Carta, health plan, etc. Holding off on some home improvements – I'd probably like to have the money if I lose my job in a downturn, and I might get a better deal on labor in a downturn if I don't (or be able to snap up cheap assets or whatever). I chose to keep living in a HCOL tech hub even after everything went remote because I wanted exposure to both local and remote jobs – that's helpful in a good economy, and could be the difference between a job and no job in a bad one.

A lot of prep is done years ahead of time. Live within your means, save for retirement and for emergencies. Don't buy the most expensive house or car you possibly can – something that's technically affordable on a bubbly senior SWE salary is likely very not affordable on unemployment. With luck and discipline you can end up with enough of a nest egg that you don't have to stress too much about this stuff.

I graduated into the great financial crisis, and lucked into a couple of dead end jobs. A mistake I made was internalizing that the economy is bad, clinging to those jobs out of fear even after the worst of the crisis had passed, and losing out on some years of high earning after things started to get better.

Re: Ask HN: How are you preparing for the recession?

#40

Post by coffeefirst »

So, here's the thing: unlike the pandemic, your life will basically go on normally.

But you might get laid off.

The goal is, should that happen, to be annoyed but entirely unconcerned about how you're going to pay bills while you look for the next thing.

Keep an emergency fund, update your resume and reference list.

And know your budget. There are expenses like eating out that are easy to pause if you need to—disregard every idiot yammering about avocados and coffee, as long as you're saving money at the end these don't come with any risk. There are expenses that can't be cut quickly easy (rent, car payments, utilities, gym memberships with year long commitments)—these are the enemy.

That's it. You'll be fine.

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