Preparing Your Finances For A Possible Recession

Recession ahead - road sign warning concept

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As the old saying goes, what goes up must also come down.

How to Money hosts Matt and Joel don’t want to alarm anyone, that's not the point of their financial guidance podcast. But as they point out in their “Prepping for a Looming Recession” episode, fortune favors the prepared.

“As friend of the show and former guest Morgan Housel recently tweeted, ‘We're definitely heading toward a recession. The only thing that's uncertain is the timing, location, duration, magnitude, and policy response,’” Joel said laughing. “We think folks should always treat their finances in a way that assumes a recession could happen.”

So, what is a recession? A recession is when the economy stops growing and declines for two consecutive quarters, or six straight months. As Matt points out, this makes it incredibly difficult to predict recessions and most often recessions are identified after they happen.

In the meantime, Matt and Joel advise you to start securing your position at work, monetize hobbies if possible, and cut back on small spending.

“Make sure you are indispensable,” Joel said. “If you aren’t sure where you stand with your boss check in and see if there is any disconnect between the two of you.”

Every decision matters, and money saved can help in times of economic or financial stress. To hear the full conversation about financial recession planning or to hear Matt and Joel discuss other financial topics, check out How to Money on the iHeart Radio app or wherever you get your podcasts.

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