The Economic Advisor

Recession Confirmed - Are You Recession-Proof?

Instead of defining the term recession-proof in terms of your employment, I propose we define it in terms of time.How long can you live without your job?Most “experts” urge people to have at least 3 and preferably more than 6 months worth of expenses in savings to protect you in the event that you do lose your job.In other words, they define being recession-proof as being able to live 3-6 months without your job.This seems very limiting and still quite scary to me.

What if you could live indefinitely without a job? My definition of being recession-proof is simple:having passive income streams that are more than your expenses. If you have this, you never have to worry about losing your job!Your expenses will be covered regardless of whether or not you are working.

Passive income is simply income that does not require your direct participation. Some examples of passive income are:

• Pensions,
• Earnings from a business that does not require direct involvement from the owner or merchant,
• Interest and dividend income from owning securities, such as bonds and stocks,
• Royalties from licensing a patent, publishing a book or another form of intellectual property;
• Earnings from internet advertisement on your websites;
• Rent from rental property.

As you change your paradigm of being recession-proof from not getting laid-off to being unaffected by unemployment, your focus will change.Stop trying to find the recession-proof industries or the recession-proof jobs.Instead, focus on creating passive income streams that will continue to flow even if you are not working.

Are you recession-proof? Take our “>Free 2 Minute Assessment to find out.

Scott Swenson leverages his experience as a financial corporate trainer and MBA to help people take control of their financial lives and become recession-proof. Click on this link Get Recession-Proof to utilize his free 5 step system to becoming recession-proof.