67% of Americans Expect a 2023 Recession. Do These Things Now to Get Ready

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Worried about a decline in the economy? Read on to see how you can protect yourself in light of one. 

For months on end, financial experts have been sounding recession warnings. And while you may be tired of hearing them, it’s also important to face reality and accept that economic conditions have the potential to change for the worse at some point this year.

New data from Northwestern Mutual reveals that 67% of Americans are anticipating a recession in 2023. Whether you feel the same or not, it’s important to prepare for things to get worse. And you can do so by making these moves.

1. Boost your emergency fund

Do you have enough money in your savings account to cover three months of essential expenses? If not, then it’s time to focus on growing your emergency fund.

If a recession hits and you lose your job, you might need your savings until your unemployment benefits start coming in, assuming you’re eligible for them. And even then, those benefits most likely won’t come close to replacing your full paycheck, so you’ll need cash reserves to fall back on.

What if you have enough savings to pay for three months of expenses? Well, at that point, you have a choice. You could decide that you’re comfortable with your level of savings and leave things at that. Or, if you have expenses you can slash without making yourself too miserable in the process, you could go that route and beef up your savings balance even more for added protection and peace of mind.

2. Shed high-interest debt

High-interest debt, like a credit card balance, can be financially harmful at all times. After all, you’re basically throwing your money away in interest form.

But it can be especially problematic to be carrying a credit card balance during a recession. If you were to lose your job, having those extra payments to make could put a strain on your already precarious finances.

That’s why now’s a good time to do what you can to whittle your high-interest debt down to $0. Not only can you look to cut your spending, but you can turn to the gig economy for an income boost and use your earnings to pay off your debt before conditions worsen.

3. Grow your job skills

It’s unfortunate that sometimes, even highly skilled and valued workers end up losing their jobs when companies are forced to cut costs. But if you’re willing to make the effort to grow your job skills, it might prevent you from landing on the chopping block during a round of layoffs. And if not, having more skills might make it easier to find a new job should you end up having to do so.

Not only should you aim to build more skills related to the job you have, but you should also think about the skills needed to get the job you want — assuming they’re not necessarily one and the same. And who knows? If you work at developing more skills, rather than lose your job in the coming year, you might end up in line for a promotion.

The idea of a recession can be scary, and it’s natural to feel helpless when you think about a widespread economic downturn. But if you boost your savings, pay off high-interest debt, and solidify your job skills, you can put yourself in a better position to get through a recession unharmed.

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