What should you do now to prepare for a 2022 financial recession ? Part 3 - 3 minutes read
If You Owe Money
If you currently have a stable job, keep working your debt snowball and making extra payments on your debt as you have been doing. You'll feel so much freedom and calm once you're debt-free. Additionally, factors like increasing food prices or a decline in the stock market won't harm you as much when you aren't devoting the majority of your income to debt repayment.
Large corporations, particularly in the computer industry, have recently announced layoffs. Therefore, stop your debt snowball if you're unemployed or anticipate losing your employment soon. Hey, we get it. It probably hurts a little to hear that after all the effort you put into wiping off your debt, but for the time being, you need to get ready for a storm.
Cover your Four Walls first, which are food, utilities, shelter, and transportation, and keep some cash on hand. If your Four Walls are covered (so your debt doesn't default), stop making any more payments toward your debt, but keep up with the minimum payments. The most crucial thing is to look for your family and yourself.
Also, keep in mind that you shouldn't take on extra debt, even how afraid you might feel if you lose your work. You're already having trouble, and taking on more debt would just make matters worse and put you in worse financial straits later. Even in a recession, when you've lost your job, when you're terrified, and even when you're in debt
If you're saving
don't stop! Keeping an emergency fund on hand is always a good idea. Consider it this way: Having an emergency fund in place will provide you peace of mind in the event of a recession. Your emergency fund serves as the barrier you require between yourself and life on a constant basis, not simply when a recession is predicted.
And now is the ideal time to maximize the value of your money. If you've been sort of budgeting all along, get serious and create a zero-based budget to give each and every dollar a purpose.
If you are saving for retirement, you should.
You might be tempted to sell your mutual funds at a loss and invest the proceeds in something secure to weather a downturn in the stock market. But hold on, take a deep breath, and try not to let fear push you into a bad decision. We often joke that investing is like riding a roller coaster: the only people who get wounded on a roller coaster are the ones who get off too soon.