It will be fantastic to see the back of this miserable economic nadir. Hopefully, as the days get longer, the outlook gets brighter along with the weather. But we still have several months to slog through until it all starts to look a bit more cheery – and it could take many more months before we achieve decent, positive growth.

How can you improve your financial situation? There are essentially two methods for boosting your position: 1) spend less and 2) earn more. This is blindingly obvious in theory, but surprisingly hard to put into practice.

Cut spending: easier said than done

The advice for spending less focuses on your discretionary spending – budgeting, meal planning, cancelling subscriptions, consolidating debt.

Unfortunately, most of us have massive, fixed outgoings that soak up most of our incomes. Mortgages, rent, rates, insurance, electricity and childcare, for instance. There’s only so much you can do to negotiate lower prices on these costs. You can shop around to some extent, but there’s a limited amount of wriggle room.

It may be that you’re forced to go backwards temporarily until your situation improves. If you know better times aren’t far away, you can hold out until they improve by spending as little as you can.

If s... gets dire, though, you may need a way to reduce your fixed costs. Moving to a smaller house, for instance. Shifting to a lower cost-of-living area. Downgrading your car. These are major changes, but reducing your fixed outgoings can seriously improve your finances.

Boosting your income harder than ever

Increasing your income may be easier than cutting your spending. The obvious answer is a promotion or pay rise. If you can secure either of those in this gloomy economy, you must be doing something right. Keep up the good work.

What if you can’t earn more from your current work? There are plenty of options, although none are particularly appealing. You could take a second job or gig work. Add a flatmate or Airbnb the spare room. Search for a higher-paying job in a fairly horrible job market. Sell everything in your house that you don’t need. Move to Australia for higher wages.

Hard decisions all round. Hopefully, you will only need extra income to tide you over until mortgage rates drop, or a child starts school, or your industry improves and wages increase.

Finally, if you are eligible for government support, take it. Rich people come up with strategies to avoid paying tax, and they don’t feel guilty about it. Why should you feel guilty about taking a benefit you’re entitled to?

Combine ingredients for best results

If you cut your spending and boost your income, your bank balance should look a lot healthier. Your lifestyle, though, could be much worse, but desperate times call for desperate measures.

Most older Kiwis will tell you (at length, in boring detail) about times when they had to stay home, eat baked beans and make their own molasses to save money. This is when you get some of those stories of your own, so you can bore the next generation. With any luck, one day you’ll be in your sixties, living a fabulous lifestyle and reminiscing about the time you didn’t go on holiday for five years so you could keep paying the mortgage.

The real trick is to learn from this economic downturn so you’re ready for the next one – and there will be a next one.

Stay with this website to catch Amy’s fourth segment on how to survive the economic downturn.