Tips on “how to save money in recession” have become a hot topic. Not because they do any good, but because that is what “we the people” want to hear.
Approximately, every show watcher or listener has come across on announcements such as; Today, XYZ, a finance expert will join us to share the latest tips on “how to save money in recession.” The tips and advices sound something like: you can save money by buying winter clothes in summer and summer clothes in winter. Surprisingly, we give it a big applause! From a financial perspective, there is nothing wrong with advising people to make a good investment decision, but such tips and advices can hurt our economy, because “panic feeds recession.” Dictionary.com defines recession as “the act of receding or withdrawing.”
A statement such as “how to save money in recession” has multi effects on people. In our case, it may attractive to individuals purchasing clothes, but it is a negative influence on people in general, because it effects the circulation of money. Again, there is nothing wrong with educating people on how to save money, but right now is not the right time. Why? Because it can be very discouraging to individuals seeking to make an investment such as finance a house. No one likes to head north (invest) while everyone is running towards south (panic).
In bad economical times, we should not advice people to save money, even though; that is what we would like to hear. It does not do any good just like saving water does not do any good to firemen when fire strikes. We should not consider saving money as a solution, because the more we save, the more people lose their job. If you over-save today, your neighbor might lose his/her job tomorrow and vice versa. Instead, we should consider investment. Now is a good time to buy that house that you have been saving for years.
In a recession, you can get your money worth because the demand and prices are much lower.