Most of the doom and gloom is starting to lift from the media, and there are talks of economic recovery. However, we are still in a recession, and President Obama and others have warned us that economic recovery is likely to be a slow process. You don’t come out of a funk like this (something decades in the making) overnight. If you are lucky, and if you have been making the right moves, chances are that you are positioned to have your personal finances mostly survive the recession.

Even if you think you will be fine — and especially if you aren’t quite sure — there are some smart personal finance moves that you can make during a recession. These are things that can help you extend your money supply and improve your cash flow. And you can continue practicing these personal finance principles even after the recession ends. It never hurts to start preparing for the next downcycle.

Here are 6 smart personal finance moves for the recession:



Track your spending. Know what you are spending your money on. Be aware that some of the little things, added up and compounded, can take a big bite out of your finances. Also, make a note of where you do your spending and what you use to pay. Paying with credit card (and carrying the balance) means that even more of your money is going elsewhere. Identify your problem areas. Do you buy more when something is on discount? Do you look for deals and then buy just to buy? Do you have a weakness for certain products? Figure out what you are spending the most on, and why. And then consciously make an effort to improve. Prioritize your spending, cutting out most of the unnecessary. Decide what is really important to you. Now that you’ve tracked your spending and found your weak spots, you can create a spending plan that addresses these issues and makes sure that you cover the important things first. (Hint: some sort of savings is one of the most important spending priorities.) Save a little. During a recession, you may not be able to save as much as you would like. However, you should do what you can to set as much as you can aside. Work toward building up your emergency fund. Also, a recession is a good time to keep adding to your retirement fund. Investments are on sale right now, and adding to your retirement account can mean bigger gains later. If you are a little nervous about some of the investments out there, you might consider index funds. Stop adding to your debt. Even if you don’t have money to spare for aggressive debt reduction right now, you can still stop digging the hole deeper. Arrange your spending plan so that you cut out the waste and the excess so that you don’t “need” to turn to credit cards. And, of course, if you have a little bit that you can use to pay down your debt, that’s even better.

Try to diversify your income. Now is a good time to attempt to diversify your income streams. Dividend investing can be one way to increase your cash flow. You can also sell some of your unused stuff. Try starting your own business, or making money from a hobby. You can even look for ways to make money online. Just be careful of scams and be realistic. You may not see immediate results. But starting now could provide a source of income that can serve as a safety net down the road.