The economy is constantly changing: it depends on foreign and domestic policies, unemployment, purchasing power and other factors. We talk about how to make money in crisis and keep your savings.
First, it is worth accepting the fact that the crisis is natural. It is cyclical and, on average, happens once every 10 years, unless, of course, other factors have played a role. Now we are facing a crisis in several areas at the same time: information, economic and medical.
The latter was revealed with the onset of the pandemic – there were not enough doctors, hospitals or medicines. The economic crisis came with the start of the military operation and is exacerbated by the fact that business has not yet recovered from the pandemic. An information crisis is information noise: false information, unfounded opinions, etc.
So the crisis is what redistributes finance. The bottom line is understanding which niche you need to move into. So, for example, if Aeroflot shares fell with the start of the pandemic, ZOOM shares soared.
How to make money in crisis
So there are several main ways. First, you can buy assets that have dropped in price. How can you make money from commercial real estate in a crisis? Buy something that has dropped in price but will go up in price later. However, you need to understand that this is a long term investment for at least 5 years. In addition, there is still a risk that the price of the asset will not rise. Second, it is possible to find a new use for the resource, which during the crisis changed from an asset to a liability. For example, create a business on hotels that are idle in quarantine.
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Third, buy what the demand has grown. For example, start producing masks and antiseptics. Finally, another option: develop your business so that when a competitor leaves the market, it takes its place. If a niche “sunk”, this is not always a reason to immediately think about bankruptcy, it makes sense to work twice as hard.
So, to understand what to do next, you need to decide what will be demanded. Here are some options.
Internet Services
This includes the development of apps, websites, online stores and cinemas, delivery services and online education. First of all, analogues are going out of business: we cannot study on Coursera, buy clothes in many foreign boutiques or launch advertising on Instagram. People need to somehow develop their business, they still want to buy nice things or make repairs in the apartment. You can take the place of competitors or come up with a new product. However, it is worth considering which segment of the audience you are working with.
Everything at the base of Maslow's pyramid
These are, for starters, physiological needs. These include the need for quality sleep, food, quality rest and a comfortable place to live. How to close them? For example, open a small production of products: chocolate, cheese, desserts. Another option is to make your own clothing brand.
The second level is the need for security. Emigration assistance services, quick foreign passport registration, etc. began to be required. Those who don't want to go abroad try to feel safe at home. The third step is the need for love and belonging. The popularity of the services of psychologists, interest clubs, etc. it's growing up.
Anything that solves the problem
In a crisis, there are more problems, and surprisingly, this is an advantage for competent entrepreneurs, not a disadvantage. People pay for solutions they haven't found.
Think about the challenges people are currently facing, which you can help overcome, like offering solutions for money.
It should be borne in mind that in the case of creating a business in crisis, speed is very important. You don't have to compete with big companies, but you do have to outperform a dozen others.
What else can be done?
The best thing to do is to prepare in advance. That means you should have a financial cushion for yourself and the business if you have one. The longer you can live with the money saved, the more relaxed you will be and the more opportunities you can take advantage of.
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Someone will say that the above tips are only suitable for “mild” crises. And what to do, say, in case of default? Again, there are several options. First, consider that your contribution may be frozen. Second, buying real estate, which is generally not very profitable right now. Demand is growing and so are prices. Many properties are overpriced. Finally, the purchase of currency. Well, if you had savings in dollars or euros.
The most reliable option, perhaps, is to invest in a business you plan to develop or buy European or American blue chips. It may be worth buying similar machinery, equipment and resources if their price has increased slightly.
Conclusion
All of the above are just ideas of what can be done. You will have to decide how to proceed. We describe basic economic advice. This includes portfolio diversification, creating a financial cushion and finding new solutions. Try to see opportunities, not problems.
For example, you are a photographer. It seems that their services are not a matter of prime necessity, they are not cheap and, in general, not everyone depends on them. On the other hand, people will open their own business. This business needs a website, social media, advertising and therefore high quality content. Also, many will start looking for an opportunity to relax and have fun, and you can create something for them.