How to Make Lots of Money During a Recession

 A recession is possibly the best time to launch a new business or to  expand an existing one. It’s also a great time to get ahead in your  career. I know this sounds counter-intuitive, so let me ‘splain. First, the media goes nuts during a recession. They turn a little bit  of negativity into a mountain of pessimism. This makes a lot of people  financially paranoid. People become socially conditioned to expect the  worst. If you buy into this social hysteria, you become a victim too. But if you tune out such stupidity (not watching TV helps a lot) and  maintain a grip on rational thought, you’ll see some amazing  opportunities popping up everywhere you look. During such times people get scared and start cutting back on  expenses. They cut some of the fluff from their lives. They stop buying  so much stuff they don’t need. This causes some businesses to do poorly, especially businesses that  don’t provide stuff we really need. We can live without new credit cards  and gas-guzzling SUVs for a while. Those non-essentials can be put off. We also become more sensitive to receiving genuine value. When we spend money, we want to make sure we’re getting a fair deal. Consequently, businesses that provide genuine value can actually do  better during a recession. More people will flock to those businesses in  tough times, while the fluff businesses will become more and more  paranoid. In the USA there are a lot of fluff businesses. Many are based on the moocher mindset,  trying to extract money without providing fair value in exchange. A lot  of the dead or dying financial companies are like that. The American  auto industry has been contracting as well, at least in part because  they’ve been creating inferior products that people don’t really need.  (Erin and I own a Honda, despite the fact that we could have gotten a  significant discount on GM cars because two of my family members used to  work for GM. We looked at some GM cars and quickly concluded they  sucked. Other family members weren’t so lucky.) A lot of people have been learning that job security doesn’t mean  much these days. More than 500,000 Americans learned this lesson last  month when they lost their “safe and secure” jobs. 

The Stupid Approach to Making Money

Lately I’ve seen a lot of people, some of them friends, do some  really dumb things in an attempt to earn more money. They buy into lame  money-making programs, join and promote useless MLM schemes, and fall  prey to scammers. The common pattern is always the same — they’re focused on trying to  make more money. They make it their top priority. They think about it  constantly. But they keep getting sucked into trying to make money  without providing any real value, and it’s unsustainable. In the end this sort of thing eventually self-destructs. The only way  to succeed with it in the long run is to find lots of suckers and  basically rip them off in order to enrich yourself. Most people have a  strong enough moral resistance to this sort of thing that they’ll  sabotage themselves from going too far with it. This isn’t a path of  long-term abundance. It’s a path of scarcity. As a general rule, the people I know who are most focused on trying  to make more money this year are doing worse, not better. In some cases  they’re doing much worse. A few have lost or are in the process of  losing their homes. The exceptions are those that are able to sufficiently kill their  conscience, so they can remove any incongruencies about ripping people  off. But again, this is a pretty rare exception. Most people would  rather deal with scarcity than knowingly rip people off to get ahead, so  they just make the bare minimum to meet their needs and avoid getting  ahead. 

The Smart Approach to Making Money

There is a smarter approach, however. Instead of focusing on trying to make more money, put your time and  energy into CREATING and DELIVERING real value. Find a way to give  people what they want and/or need. Take note that the keywords here are CREATE and DELIVER. Creating value means expressing your unique talents and skills in a way that can potentially benefit others. Delivering value means ensuring that other people are actually receiving and benefiting from the value you’ve created. If you don’t do both in some fashion, then it’s going to be hard for  you to generate sustainable income, especially during a recession. I’ll  explain why. If you only create value but don’t deliver it, then your value isn’t  being received by anyone. So how can you receive value (such as money)  in return? I see this problem a lot with creative types such as would-be  artists, musicians, and writers. They may spend lots of time honing  their craft, but if they don’t actually get that value into the hands of  sufficient numbers of people, they struggle financially, and this hurts  them creatively too. A goodly number of these people are currently  seeing their homes in foreclosure now. The sad thing is that some of these people work very hard. But they  spend too much time creating and not nearly enough time delivering. They  watch people they consider hacks pull ahead of them. The hacks may not  be as good on the creative side, but at least they’re getting their  value into people’s hands, and on some level people are appreciating  their work. I went down that road myself. In the late 90s, I went bankrupt, even  though I was working very long hours and creating a lot of potential  value in the form of a computer game my company was developing. My  problem was that I didn’t do a good job of getting that value delivered.  I relied on publishers to do that, and for various reasons the game was  never released. That resulted in years of wasted effort, aside from the  valuable learning experience that is. So I know where this road leads  because I traveled it. On the other hand, if you only deliver value but don’t create it,  then you’re delivering someone else’s value. This isn’t a terrible  approach in the short run, but it’s a short-sighted long-term strategy  if this is all you do. There’s nothing particularly special about  delivering other people’s value. Anyone can do it. Anyone can sign up  for affiliate programs or join an MLM program or become a reseller. If  this is your primary means of generating income, your long-term outlook  is weak. The better this works for you, the more it will draw  competitors into your field. Eventually everyone will be working harder  and harder for scraps. This happens all the time. This strategy can be  especially weak during a recession, as more people turn to less  expensive sources for the same value you deliver, squeezing your profit  margins thinner and thinner. Bloggers fall into this trap when they rehash other people’s content  and don’t really have anything unique or compelling to say. A year later  their niche is flooded with competitors doing the same thing. And  hardly anyone is earning decent income from it. The most viable long-term strategy is to create AND deliver value.  You can mix and match other strategies with it, but this should be your  primary method of income generation. If you get good at creating and  delivering value, you can basically write your own ticket and enjoy lots  of abundance.