20 Financial Lessons From The 2008 Recession

2. Company Culture Matters

Some companies truly do value the environment they provide to their employees, and they think a lot about the culture. The companies that truly cared a lot about cultivating a warm environment are often the ones that succeeded in the long run. Think about companies like Pixar, where they have a bright, colorful office spaces that encourage creativity and remind people what it’s like to be a kid. Or Google, where they have amazing on-campus food options, and plenty of meeting spaces. People are proud to work there, and they work harder as a result.

In the past few years, the idea of providing a healthy corporate culture has become a more well-known topic among business owners. People don’t just pick one career and stick with it the rest of their lives anymore. If companies want to to retain employees, they have to improve their company culture, which only benefits people who work there.

3. Don’t Get In Over Your Head With Debt

Unfortunately, it’s very easy to get into debt to the point where your financial situation is underwater. So many people lost their houses to foreclosure during the financial crisis, because they got laid off or took some kind of pay cut. Banks were giving away mortgages to people who could not actually afford it, too.

Now, most people are far more cautious before they get into debt or take out a credit card. Banks have also increased their standards for what they look for in someone they are lending to. While it may seem more difficult to establish credit nowadays, it is generally being done in a much more responsible way.

4. Student Loans Should Not Be Taken Lightly

Parents want the best for their kids, which is why so many of them pushed for their sons and daughters to go to college. It used to be normal for people to take out tens of thousands, if not hundreds of thousands of dollars in debt in order to get a degree in something like dance therapy. Unfortunately, 18-year old kids don’t know to do some research to see how realistic it actually is that they will find a high-paying job after graduation that justifies the debt they are getting themselves into.

Thankfully, the next generation of students is a lot more aware about how student loans are tied to your ankles until you die. It is forcing a lot of colleges to re-think what program they choose to major in, and what that job market is actually like.

5. Professional Relationships Matter

There are plenty of people who don’t get along with their manager or co-workers. The 1999 movie Office Space is mostly about a guy who hates his higher-ups at his desk job, and he finally breaks free of his mundane life after getting hypnotized to stop caring.

For years, people just accepted that their job was a place to get work done, and the rest of their time was dedicated to friendships and relationships. Now, people value having good work relationships so much more than they did before, and that’s a very good thing.

6. You Should Always Be Networking

It’s easy to feel like you can put your days of networking behind you once you find a really great gig. But what happens if you lose your job with that company, and everyone you know in your field works for them, too? Even if you love your job, it doesn’t hurt to keep networking. The more people you meet in any given industry, the more opportunities you will learn about. If you network regularly, and you lose your job, you have people to reach out to who may be able to help.

If you feel really introverted, and going to network events sounds like a nightmare, there are plenty of ways to meet people online. Join Facebook groups, add people on LinkedIn, follow other professionals on Twitter, and keep in touch with old friends.

7. Always Value Your Past Experiences

During the recession, a lot of people got laid off. Even if it didn’t happen in 2008, there was a trickle-down effect where budgets were cut, and a lot of people had to leave their jobs for one reason or another. Sometimes, these memories can be painful to even think about, and you might hope that no one asks about your past job during an interview.

Instead of reminding yourself of all of the cringe-worthy ways that job ended, remember all of the skills that you learned there, instead. There is still value in your experience, even if it’s just customer service or knowing how to use a cash register.

8. Always Be Prepared For The Worst Case Scenario

For a hundred years, the Boy Scout motto has been: “be prepared”. They’re talking about walking in the woods with a first aid kit. It may sound very cliche, but you should always have a “rainy day fund” in case of emergency. If you open up a credit card, keep a lot of credit open in case you have to borrow money, too. Many people who lost their jobs during the recession did not have enough money saved to cover their monthly expenses beyond a couple weeks. If you can, try to get ready for anything that comes your way.

9. It Takes A Long Time To Find A Job

Even if you have a college degree and a great resume, it still might take you a few months to find a new job. There is a lot of competition in the job market post-recession, and even 10 years later, it is still difficult to find a new job quickly. Even if a company wants to hire you, it still takes time to get your first paycheck.

It’s best to stay at your current job as long as possible, and attempt to go on interviews before leaving a job. That way, there is no gap in employment.

10. Side Hustles Are Not Something to be Ashamed Of

In the past, taking on a second job was almost taboo. In the days where people got one career and stuck with it, finding a second job was a sign that you weren’t making enough money, or that you got yourself into some kind of financial trouble.

Today, having multiple jobs and side-hustles is actually a respectable thing to do. It means that you are willing to work hard, and do what it takes to pay the bills. Once you have experienced working side-hustles, it also helps to put things into perspective about opportunities to find new work if you happen to fall on hard times.

11. Do Not Tie Your Identity To Your Job

When we introduce ourselves to someone new at a party, we usually start off with what we do for a living. But sometimes it’s hard to remember that you and your job are not the same thing. Without your job, who are you, really? Anyone who lost their job during the recession and was forced to change careers will realize that at the end of the day, you are still you, regardless of what your job is. Your real friends and family will still love you no matter what your job title is. And you will still be able to do the hobbies you love and your passion projects regardless of where you work.

12. Sometimes, Bad Things Happen, And That’s OK.

Even if you live your life trying to do everything perfectly, it’s still possible for something to happen that is out of your control. And there will always be people who are trying to take advantage of the nice guy to get ahead. Sadly, bad things happen to good people. And sometimes, terrible people get away with making a lot of money.

It’s just the truth of reality, and if we hang onto that injustice too much, it can really be depressing. In most cases, you should no take it personally if you are a nice person who got the short end of the stick. Realize that these things happen, and it’s best to move on.

13. You Are Capable Of More Than You Think

As companies are getting smaller and smaller budgets, some of them cannot afford to have one employee doing just one task. They might add on new responsibilities to their existing employees. While this can seem like it’s a huge pain to deal with, it can also be a lesson that we are capable of so much more in a single work day than we thought we were.

No matter what the scenario is, pushing yourself to tackle a difficult situation can be very rewarding in the end. Looking back over the past ten years, you can probably think of a few moments where you had such an overwhelming amount of things to do, and yet it still somehow got done.

14. So-Called Experts Are Human, Too

There have been so many scandals in the media about so-called financial experts being exposed for fraud and corruption on Wallstreet. At first, it came as a shock to a lot of people, because they looked up to these people as being examples of totally professional and responsible finance “experts” who should know what they are doing. Now, we know that these are real humans who can be greedy, and they can make mistakes.

Even if you do not work on Wallstreet, there is still a lesson that can be taken into your real life. No matter how high up someone’s job title might be, it’s easier to remember now that they are humans, too.

15. Tragedy Puts Things Into Perspective

If you were one of the people who lost their job during the financial crisis, your perspective of what you consider a “bad day” at work has probably completely changed. Pain makes us stronger, and it helps put things into perspective. With so many other people around us who have been through hard times, it makes everyone more down-to-earth, and honestly better to be around.

For example, maybe your boss was late to a meeting. But at least he treats you fairly, compared to past bosses who screw you over. Or maybe you were annoyed with a coworker. But you’re just happy to even have coworkers, after being unemployed for a while. Basically, don’t sweat the small stuff, because it could always be worse.

16. Stock Markets Are Always a Roller Coaster

For anyone who invests in stocks for the first time after 2008, a bear market can scare us into pulling our out all of our money. We all seem to be afraid of another impending crash where we lose it all.

You really should try to educate yourself if you want to enter the stock market. There is a lot to learn, and there is a reason why Investopedia is a massive website. But what experts know is that it is completely normal for the market to have highs and lows.

One of the richest men on the planet is Warren Buffet. His net worth is around $90 billion. His investment strategy is to find a handful of companies that he has taken the time to do a lot of research on. Once he knows enough information to truly believe in a company, he will invest in that stock. That way, if there are ups and downs, he can be calm knowing that in the long run, his investment is safe, because he trusts the company. If you feel panicked about the highs and lows of your investments, it is probably because you have not done enough research to feel that same sense of confidence.

17. Don’t Put All Your Eggs In One Basket

In 2008, so many people lost their retirement funds from their 401K. Tragically, these people probably put all of their money into that one place, because they totally trusted that their money would be secure. Now, most people know that it’s smarter to diversify your investment portfolio. That way, if one of your investments fail, at least you didn’t have all of your money in one place.

18. Don’t Invest In Something You Don’t Fully Understand

In 2017, Bitcoin hit an all-time-high of $20,000, and people who had completely ignored cryptocurrency for years suddenly wanted to get their hands on some BTC. Even though there were plenty of warnings from market veterans that this was just a bubble that was ready to burst, people were blinded by the opportunity to make money. Some people even sold their houses to purchase Bitcoin, without understanding that it is actually a terrible long-term investment. The coin is basically worthless, and its technology is actually really slow and outdated, compared to Ripple’s XRP.

At the time this article was written, one Bitcoin deflated back down to $6,600. While that price is nothing to sneeze at, there are a lot of people who lost their money…Why? Because they invested in something they didn’t fully understand, and they jumped on a bandwagon.

This doesn’t just apply to cryptocurrency. People blindly invest in their company’s retirement plans, simply because the rest of their co-workers are doing it. Other will find an index fund, because their friend says it’s the best. If you plan to invest your hard-earned money in something, do your own research.

19. History Repeats Itself

Even though things are getting better, and the economy is recovering, that doesn’t mean we are safe forever. Unfortunately, history repeats itself, especially when people fail to learn lessons from the past. We cannot control what the bigwigs on Wall Street do, but we can control how we manage our own finances. And if you have kids, you can teach them to be more financially responsible than you were. A lot of the issues are preventable, as long as you see them coming.

20. Life Moves On

Probably the most important thing that you could learn from the Great Recession is that no matter how bad things may seem in the moment, life still goes on. The world keeps turning. Sometimes, it’s best to take a deep breath and take a look around nature to remind yourself that there is so much else going on in the world. The most important part of our lives are the people we surround ourselves with. As long as you’re still breathing, you can keep moving forward.