Do you remember the recession of 2008?

For so many, it hurt. Markets were plummeting, homes were being foreclosed on, and many were losing out on business profits, ideas and projects that had taken years to get into place. But what were the most valuable lessons we can use now to avoid that same pain or loss?

I’ll never forget it. I first think back to what I was doing in 2007. It was an amazing year. Our firm had a game plan with the messaging and marketing dialed in, but we didn’t adjust it as the economy began to change. We were not current with or in tune to the problems and concerns of those we served and as a consequence, we watched our number of conversions and cash flow drop. Our marketing still provided plenty of leads, but people became hesitant of what the economy had in store and the same messaging did not resonate or work. With a few tweaks and some basic preparation not only would we have continued to be profitable, the changing economy would have fueled even more growth.

Today, we are facing the second longest period of time in US history without a recession.

So what were those lessons and insights you learned from the last recession that can help you to grow during a downturn? When the recession eventually comes, there are fundamental pieces to put in place to avoid the mistakes and missteps that lead to loss; but most importantly is being able to see how times like that can be the biggest opportunity to grow your wealth and business!

For example, lots of money will be reported as “lost” during the recession, but in reality it’s just being transferred. The money doesn’t disappear or evaporate, it ends up in someone else’s hands. The question is, how can you be one of those it is being transferred to? If you are prepared you can have the means to be a part of the solution, and not stuck in the problem.

Here is a very simple and short list of things you can do to be prepared for the next economic recession.

1. Liquidity, liquidity, liquidity.

People are overly invested into volatile accounts and long-term investments, but miss opportunities by not having access to cash. The overemphasis in finance is net worth, but during a downturn net worth is at risk. If you were required to sell or liquidate any of your assets to access cash in a recession you put your money at risk. The solution is to build up liquidity through savings accounts, cash values in insurance, or anywhere you can access cash quickly and without reliance on the market performance. This is key to making money on the buy when you can buy assets in distress.

2. Protect your downside.

A trailing stop-loss is an order to automatically sell your investments if the market goes below an amount you are comfortable with. This limits your risk. At what point if the market goes down, does your mindset follow with stress, angst, or frustration? You are your greatest asset. Protect your ability to be productive and focused rather than frustrated and distracted by economies and markets outside of your control.

3. Stop tipping the government.

Rather than taking risks with investments and waiting for years for something to pay off, first, legally save on taxes to improve cash flow. There are so many ways to do this: you can maximize deductions, build a great tax team (including a tax strategist and attorney), and chose the right corporations to move your income from active to passive, ordinary income to capital gains, or discover tax free strategies like Charitable Remainder Trusts. You can also take a look back for the last three years and potentially amend your returns to get the government to pay you for a change. This can boost your savings account without requiring you to budget or eliminate any of life’s enjoyments (in the name of saving) today.

4. Optimize your cash flow by restructuring, renegotiating, or reallocating your loans.

Now is the time to restructure loans! Restructure loans to lower payments. Use your mortgage or car to get better rates over lines of credit, credit cards, or business loans. Next, renegotiate interest rates on your loans, especially credit cards. Finally, if you have any underperforming investments or savings that are earning less than you are paying in interest, cash them out and pay off the loan.

5. Drop coverages that don’t give enough coverage.

The most expensive insurance dollar is the first one your pay for. That means low deductibles, short elimination periods (the time before the insurance kicks in), or insurances that do not protect you from anything of major consequence, are costing you more than you benefit. Instead, insure the catastrophic and not anything inconsequential. These are things that if they were not insured today would not destroy your peace of mind and you have the cash to pay for it.

6. Get back precious time.

Busyness is a liar and robs entrepreneurs of time and money. This may be in the form of ineffective meetings, too frequent of meetings, or longer meetings than necessary. It may be spending time on less important things like handling your own email, which gives people access to you when unsolicited. To increase your cash flow and productivity today, eliminate busyness and replace it with cash flowing and productive activities.

7. Make more money without creating more work.

When was the last time you adjusted your pricing? When was the last time you looked at your margins? Is there something if tweaked could increase profitability? For example, ask yourself “How can I keep my customers for longer?” Where can I add more value to existing customers or partner with others that can provide my customers more? Increase your cash flow today, communicate with your customers, and be willing to make adjustments to your message and pricing.

The key is to focus on cash flow and building up plenty of liquidity when recessions hit.

The cash can act as staying power or even an opportunity fund. Cash flow can indicate if something is no longer working or could be adjusted. Stay focused on value when everyone else turns to survival. Bring more value and increase that value for your clients and the money will transfer to you.

This article by Garrett Gunderson was originally published on Forbes.com

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Join Us for Financial Trends Summit and Make Yourself Recession-Proof

On October 3rd and 4th, Garrett and our team will be hosting our first-ever Financial Trends Summit to show you…

• How to profit in the next recession instead of losing money
• How to thrive in an Artificial Intelligence world and the New Economy
• Plus where the best exponential growth opportunities exist

It’s a 2-day live digital event — so you can join us from the comfort of your own home. And you’ll also get lifetime access to video replays with full transcripts…

Plus workbooks to help you learn and implement the recession-proof strategies step by step.

And you’ll also save $100.00 if you get your Early Bird Ticket before 11:59pm Pacific this Monday, August 19th.

Surprise bonus: When you get your Early Bird ticket today, you also get an advanced audiobook copy of Garrett’s newest book Win Then Play as soon as it’s available, probably a few weeks. This won’t be released to the public until it’s officially published in 2020!

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