Make These 7 Moves Before a Recession Hits in 2023
Though it’s not written in stone, a recession is likely going to hit in 2023, and Americans need to be prepared. In order to get ready for what could be tough times ahead, consumers must make the following moves.
See: Can I Draw Social Security at 62 and Still Work Full Time?
Discover: 3 Easy Tips to Turn Your Credit Woes into Wows
Build an Emergency Fund
It’s never too late to start saving, and even stashing a little bit can go a long way. How much you should have saved depends on your age and where you are in life, but aim to have at least 3 to 6 months worth of living expenses in savings.
Seize the Hot Labor Market
The job market has been hot, and the U.S. economy added 263,000 jobs in November. Seize the day and move up the career ladder while there are still tons of new openings. This is also an ideal time to update your resume and get into the habit of “career cushioning” should layoffs come to your company. As GOBankingRates has previously reported, career cushioning means preparing for whatever comes next in the economy and job market — taking actions to keep your options open.
Delay Major Buys That Require Financing
The Fed just raised interest rates and intends to do so again in the new year. Now is not the time to purchase major goods that require financing.
Focus on Paying Down Debts
Instead of making purchases, focus on paying down debts — especially high-interest debts.
Invest in Stocks, Wisely
When the economy enters a recession, stocks tend to slump, making it an ideal time to snag stocks at lower-than-normal prices. It’s critical to do research and work with a financial advisor and, perhaps most importantly, be willing to ride out your investment for the long haul, through thick and thin.
Consider Bonds
Bonds are great investments right now amid spiking interest rates.
Jason Blackwell, head of investments at financial firm The Colony Group, told The Hill that U.S. bonds are “potentially a better tool at [investors’] disposal than they have been for the last ten years. When 10-year Treasuries with very little risk of U.S. default are paying you 4 percent, that’s a pretty good return — a pretty good yield that we’ve not seen in almost a decade.”
Take Our Poll: How Has Inflation Impacted Your Holiday Shopping Plans?
Explore: What Is the Lipstick Effect and How Could It Impact the Economy in 2023?
Stay Calm
Remember, the U.S. has been through recessions before and has always come back strong. It’s just a matter of riding out the storm and not doing anything out of haste or fear.
More From GOBankingRates
- All the States That Don't Tax Social Security
- Explore GOBankingRates' 2023 Banking Resource Center
- The 10 Best Rewards Credit Cards for 2023
- How To Save Money When Filing Taxes
