A recession is always difficult, sometimes harrowing, but if you follow a few simple principles you can best prepare yourself to deal with it:
Live within your means.
Prepare a budget and ensure that you live within this including making inroads into any of your existing debts. Search now for financial planner.
Consolidate existing debt
Such as car loans, overdrafts and credit cards, onto one loan. Find a debt adviser.
Have an emergency savings fund.
You may not be able to obtain an overdraft or loan quickly or at all as banks tighten their credit criteria. Beyond the emergency fund only save if you have no other borrowing otherwise pay off the most expensive debt first!
Seek independent financial advice
It's not restrictively expensive and may actually save you money– always ensure that get comparable prices for similar products and make decisions based on fact ! Pick an IFA from those listed on Rubii. Investments, If you are investing for 5 years or longer or your need for a pension is beyond this 5 year period then equities may still be a better home for your money than a Savings account.
Shop around
And do not be loyal to an existing provider unless they deserve your loyalty based on price, service and safety!
Mortgage – tracker rates
These are the must have mortgages right now whilst base rate remains low to encourage spending to offset deflation. Check that your mortgage provider tracks against Bank of England bank rate rather than a managed rate of their own as potentially the latter category may delay or not pass on any further Bank of England reductions. The time to fix your mortgage again is when you and market commentators believe the rate is at a low. Read the small print and specifically ask…be aware of all fees and early repayment penalties your lender charges and check to see if they compare favourably with competitors. Find a mortgage adviser now.
Savings
Select your provider based on their safety as well as interest rate. Is the UK government guarantee per bank available (some banks have multiple brands but one banking licence and in this case only 1x £50k guarantee will be applicable). If in doubt ask a savings adviser.
Income protection/ credit insurance
Check what is available should your income suffer through redundancy. Stand alone policies usually represent better value and can cover debt with a number of providers – find a financial adviser that will be able to assist.
Tax planning
It's not just for the super rich and every higher rate tax payer should consider taking advice on income tax, IHT effectiveness and Capital Gains exposure and mitigating actions. Find a tax adviser now.
Pension Planning is for today not tomorrow.
If you are relying on property to fund your pension revisit this as soon as possible. Search for a pensions adviser.
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