8 Money Moves To Make During Uncertain Times, According to Frugal Living Expert Austin Williams
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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On any given day, the news can unnecessarily send you into anxiety spirals about what is happening to the economy, especially with a new presidential administration making changes.
However, you can’t plan your finances or live your life by the ups and downs of the news cycle. In a recent video, frugal living expert Austin Williams offered some money moves you should (or shouldn’t) make in uncertain times, reminding everyone that “nobody can predict the future” and the only thing you can do is “take financial steps to weather out the uncertainty.”
Hold Your Investments
The worst thing you can do is panic sell, Williams said, just because the S&P 500 has dropped as much as 10% (as of this writing), and some individual stocks have dropped more significantly (Tesla has dropped around 40% since the start of the year).
Hold onto your investments. Selling at the bottom can mean taking a huge loss when the market dip may just be a short-term fall. He reminded viewers that if you own index funds or stocks, what you have is not money but shares — and even if the market makes a big drop and you lose thousands in value, you still have the same number of shares.
“As long as you don’t panic sell in the long term, your investment should recover.” He called the stock market “dramatic” on a day-to-day basis, but in the big picture, the market typically goes up.
Don’t Try To Become ‘The Next Recession Millionaire’
On that note, he also recommended that you don’t try to be the next recession millionaire by snapping up all the stocks and assets that are now, briefly, cheaper.
He said that while “people will create a lot of hype that now is the best time to buy because everything is on sale, and if you make the right decisions, you can make a lot of money very quickly,” the truth is that nobody knows what will happen.
Maybe Tesla will recover and become a good value again, or maybe not. Don’t fall for hype; make smart moves.
Protect Your Emergency Fund
Don’t use up your emergency fund trying to buy any of these products or making sudden investment moves, Williams warned.
“In times like these where there’s a lot of uncertainty, it’s important to protect your emergency fund in case an emergency comes up,” he said.
He’d rather miss out on an opportunity than live in uncertainty. If you have extra money to spare and you want to snag what’s “on sale” — go for it, he said. Just not at the expense of future emergencies.
Hold Off on Big Purchases
While you shouldn’t panic, it’s frugal to react to uncertainty by being smart about your money. Hold off on big purchases like a TV or a car until there’s a little bit more certainty so that you don’t spend money you might need for more essential services or goods.
Track Your Spending
Williams said that an uncertain climate makes it more important than ever to know where you stand financially “so that you are prepared to weather the storm.”
To do that means you need to track your expenses. He argued that “many people are wasting hundreds of dollars a month on unused subscriptions, eating out too much or wasteful spending.”
Tackle your budget and track your expenses to be prepared.
Don’t Get Sucked Into the News
If you can, protect your peace by being careful about how much news you’re taking in, especially, since “we’re all living in our own echo chambers where algorithms are feeding us content,” he said. Too much information can actually distort reality and make things seem worse than they are. That can lead to making harmful or unnecessary financial decisions.
Emphasize the Long Term
It’s easy to feel anxious or panicked if you’re focused on the current or short-term perspective, Williams said. Economic changes can move fast. He pointed out how in 2020, the market had a huge crash, but months later it recovered and stayed on a long upswing.
“The truth is … on a day-to-day basis, the market is dramatic, but when you zoom out and see the big picture, it always goes up,” he said.
If you zoom out and focus on the big picture of the market, everything usually turns out OK, he said.
Focus On What You Can Control
The final step, then, is to focus on the things you can control, like managing your emotions, budgeting, tracking your spending and protecting your mental peace.
“Because at the end of the day, that is all you can do and worrying isn’t going to get you anywhere anyways,” he said.
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