American bond guru Bill Gross calls it “the new normal.” Bank of Canada Governor Mark Carney warns of “unusual uncertainty.” CIBC World Markets chief economist Avery Shenfeld labels it simply the “Great Disappointment.” Whatever you call the times we’re living in, it’s pretty obvious they ain’t great.

In every city, town and village across Canada, across the U.S., across Europe, it’s slowly sinking in: the party is over, at least for a while. The U.S. housing market catastrophe and the subsequent global stock market meltdown may be largely behind us, but in their wake we’ve been left with an unpleasantly persistent aftermath: sluggish growth, high unemployment rates, soaring personal and government debt, teetering house prices, and a dampened investment environment.

Add it all up—and throw in the fact that we’ve already done pretty much everything we can to stimulate our ailing global economies—and it really does look like we’re entering a new age of austerity. Some economists are saying that today’s sluggish real (inflation adjusted) gross domestic product (GDP) growth rate of about 2% a year could even become the new “cruising speed” for the Canadian economy—a big comedown from the 3% annual growth we’ve typically seen in the past. And let’s not even get started on the disastrous “double dip” scenarios sketched out by the economic bears.

In this environment, many of the assumptions of the past—house prices will always rise, interest rates will always fall, there’s a better job just around the corner—can no longer be counted on. That doesn’t mean you should load up on ammo and head for the hills. It just means acting a bit more defensively when it comes to your finances, at least for a while.

So what exactly should you be doing to survive—even thrive—in this age of austerity? Read on and we’ll take you through each of the specific threats on the horizon, and how you can protect yourself against each one. We’ll look at how to prosper in the new job market, what to do if you’re buying a house, how to invest your money defensively, and how you can adjust your retirement plans to stay on track. In the end, you’ll see that despite the challenging times, with a bit of belt-tightening, you can still keep your dreams within reach.

Threat # 1: No new jobs
Gone are the days when jobs were plentiful and employers focused on attracting and retaining talent. While the total number of people employed in Canada has recovered to where it was before the recession, much of the recovery has consisted of part-time work and service sector jobs. Unemployment has remained stubbornly high at about 8%, and more Canadians are finding themselves jobless for long periods.

The current situation is hard on many of us, but it’s worst for those trying to get into the job market for the first time. “It’s like the classic saying, you want me to have experience but you won’t hire me, so how do I get experience?” asks Brodie Metcalfe, 24, who graduated last spring from the University of Victoria with a B.A. in the humanities. He’s looking for work in the field of advocacy and community development, but he’s not having much luck. “Most of the organizations that normally would be hiring are not doing so because the government funding cuts have been pretty drastic.”