Invest in a business you control

- Investing in your own business is a great way to recession proof your life. A small, privately owned company is much less likely to feel the punch if there is a recession or if the stock market crashes. You're less likely to fire yourself, because a company you own isn't determined by what a bunch of day traders and computer algorithms are buying and selling it for at any particular millisecond. The company's value is determined entirely by how well it's actually doing, how much profit it's making. Its value is therefore stable. Face it, you can't control what IBM, Walmart, or Apple do, but you can control what your own company does. This is investing in something you understand. After all, there's nothing you understand better than your own business. When a recession rolls around, you might lose some customers, but the value of your company isn't going to tank like it would in the world of publicly traded stock companies. The upside, when you invest in a big, public corporation, you can go broke even if the company is making lots of money, but when you invest in your own small business, you'll never go broke by making a profit. That's the magic of investing in your own business and there's another bit of magic too. If you invest in your business and then sell it, you won't just be paid for the money your business is bringing in this year. You'll be paid for all of the money it is expected to make in the future. Let's say that you're bringing in $100,000 a year at your business. If you're likely to continue making that $100,000 a year for the next 10 years, your business isn't worth just $100,000. It's worth $100,000 multiplied by 10, a million dollars. Of course, the buyer isn't going to pay that entire million dollar figure, because the buyer wants to make a profit and money made in the future is never an entirely sure thing. Even so, you'll get paid much more than $100,000 for your $100,000 per year business. Depending on the industry, you might be paid two or three times your yearly earnings or maybe even more. You're getting paid for money you haven't even earned yet. That's fantastic and if you can increase your company's profits this year, you can increase the value of your company and its future selling price. Again, you're not likely to fire yourself in a downturn. That's the beauty of investing in your own business. Have you ever thought of investing in a business you control rather than in one you don't?