Well, that escalated quickly.

One week I’m all like ‘Sure buy some cheap shares’ and the next I’m like ‘Yeah, so you should probably start learning to grow your own herbs and bake your own bread’.

Things are crazy. Last night I spoke to my retired dad. He said he’s fine, as long as he doesn’t look at the stock market.

Side note… A study found the optimal salary for happiness, and it’s more achievable than you might think. Post continues below. 

We talked about tightening our belts and digging out my Grandma’s Country Women’s Association cookbook for some thrifty living recipes. Boiled fruitcake recipe available if anyone’s interested? (Oh wait, you need flour for that, and that’s become a weird luxury item).

His line of the week was: “The time of the tight-arses has arrived”. And damn, he is right. We’re cool all of a sudden.

People have been asking me about various topics and my main answer is: it’s time to hunker down. Sometimes doing nothing is the right choice.

A few people have asked: should I be buying shares now that the market is down?

My answer is: it’s not a bargain if you don’t need it.

If you were already in the market for equities, then sure, take a look in the bargain bin.

But like any shopping trip, you need to ask: is it cheap because it’s sale time or is it cheap because it’s a fluoro yellow mini-dress that nobody else wants? 

I have bought too many of the fluoro-dress-type bargains in my life, so now I’ve taught myself that if I wouldn’t buy it full-price, I don’t want it.

Consider Afterpay, the market darling who was so obviously over-valued (in my view). It has dropped around 75 per cent – from above $40 in February, to $9.90 at the close on Thursday March 19.

Investors are worried that all those customers who thought they could totally handle thousands of dollars of debt will, all of a sudden, be not so cool with it.

So, is Afterpay a bargain or a fluoro mini-dress? Time will tell.

I’ll be honest, the bargain hunter in me really wants to buy some. But mature Belinda reminds herself of the hot pink high-heels she bought from DJ’s on sale three years ago, which she has only worn once.

Also, I need to make an important point:

Only invest if you feel secure and have a seriously big emergency savings buffer. 

It’s clear to me that we are about to enter a recession after about 27 years of uninterrupted economic growth in Australia. Many of the readers of my blog were either kids or not even born when the early 90’s recession hit.

Pearl Jam were releasing Ten, and they were rocking the finest op-shop fashions for a reason: recession.

I don’t remember much beyond Paul Keating on the news saying it was a recession we had to have, which was apparently not helpful. I think he was trying to say that sometimes the economy is blown up like a bubble and needs a release valve.

For economic nerds, this market downturn is not surprising. The event that sparked it certainly is – nobody expects a pandemic.

But economies and markets always rise and fall – as you can see in the yellow columns below. (I pulled it from this good article).

The thing that sucks is living through the falls – which we are now.

So, now is the time to shore up your resources.

If you still have a job, save your arse off. Stop wasting money – like NOW. Ignore the politicians saying it’s your duty to prop up the economy – screw that, protect yourself.

I am not in the most secure job situation, so I am not investing much in the market right now. I’m in ‘hunker down and max out the emergency fund’ mode. My emergency funds sit in my mortgage redraw, so I’m also reducing my interest costs (low as they are).

Remember that when you lose your job in a recession, it might not just be a few weeks until you get another one. It can be many, many months.

Without wanting to alarm you, look at how quickly the unemployment rate rose in the 1990s, while I was living in blissful ignorance, worrying about teenage boys and listening to Pearl Jam:

Yes, that’s a 38 per cent increase in one year.

So, if you have the emergency fund situation sorted, maybe investing is an option. But first, make sure you are ready for a world where at least 1 in 10 people don’t have a job.

Sorry, this post turned out to be a major buzz-kill. I just want you to be in the group of people who can see what’s coming and prepare as much as possible.

This period is not about hoarding toilet paper; it’s about hoarding your savings in case the worst comes. 

And if it doesn’t come, and you sail through, then guess what? You’ve got a great savings fund to spend in a few years – on whatever badly-thought-through mini-dresses you desire!

This post originally appeared on the blog Fierce Girl Finance and has been republished with full permission.

Belinda White is on a mission to help women fall in love with finance. Her blog, Fierce Girl Finance, makes investment topics funny, relatable and easy to understand. Her promise? No jargon, no men in suits and lots of Beyonce. 

Feature image: Getty.