How to recession-proof your life in 2 stages


American workers and consumers have good reason to feel optimistic about the economy. The stock market has been on a tear for more than a decade, we're currently living through a "golden age" for job seekers, and unemployment is at a 50-year low.

Yet that hasn't stopped people from worrying about a coming recession. In fact, 38% of economists predict there will be a recession by the end of 2020 and another 34% expect one by the end of 2021.

The problem is that it's hard to predict a recession — and many of the indicators that we use to gauge the health of the economy rely on data from previous months, so we could be in a recession for a while before the status becomes official.

For workers and consumers, that means it's easy to be caught by surprise when the economy starts to bottom out. But you can make sure you're a step ahead — both financially and professionally.

How to recession-proof your life

In order to best prepare for a recession, take measures to protect your finances as well as your professional life, experts say.

How to recession-proof your finances

1. Prepare your finances

Most experts recommend that you financially prepare for a recession in the same way that you prepare for any big financial change — by scrutinizing your spending, padding your savings accounts, and limiting your debt.

"This might be the time to shore up a few things," certified financial planner Shannah Compton Game, host of the Millennial Money podcast, told Grow earlier this year.

Start by building an emergency fund with as much as six-months' worth of expenses, then make sure you have a budget in place to help control your spending. Pay off or down debt while the economy is still on solid ground, and maybe even look for ways to diversify your income by picking up a second job or side hustle.

2. Prepare your career

In a recession, it can become harder to find a job, and companies may lay off workers or reduce their hours. Depending on factors like your industry and skill set, a recession may pose more or less of a threat.

Still, experts say, it's smart to take steps like learning new skills and expanding your professional network.

While the economy is thriving, those moves can help you land a promotion or raise. In a recession, you may be better positioned to keep your job — or if layoffs strike, find a new job or pivot to a new field.

"Most of my clients are trying to proactively manage their careers regardless of the economy and don't seem to be reacting to a fear of an economic downturn," career strategy consultant Janet Matta told Grow earlier this year. "This is great, it's exactly where I want people to be: managing their careers from a place of strength rather than out of fear."

More from Grow:

acorns+cnbcacorns cnbc

Join Acorns


About Us

Learn More

Follow Us

All investments involve risk, including loss of principal. The contents presented herein are provided for general investment education and informational purposes only and do not constitute an offer to sell or a solicitation to buy any specific securities or engage in any particular investment strategy. Acorns is not engaged in rendering any tax, legal, or accounting advice. Please consult with a qualified professional for this type of advice.

Any references to past performance, regarding financial markets or otherwise, do not indicate or guarantee future results. Forward-looking statements, including without limitations investment outcomes and projections, are hypothetical and educational in nature. The results of any hypothetical projections can and may differ from actual investment results had the strategies been deployed in actual securities accounts. It is not possible to invest directly in an index.

Advisory services offered by Acorns Advisers, LLC (“Acorns Advisers”), an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”). Brokerage and custody services are provided to clients of Acorns Advisers by Acorns Securities, LLC (“Acorns Securities”), a broker-dealer registered with the SEC and a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”) and the Securities Investor Protection Corporation (“SIPC”). Acorns Pay, LLC (“Acorns Pay”) manages Acorns’s demand deposit and other banking products in partnership with Lincoln Savings Bank, a bank chartered under the laws of Iowa and member FDIC. Acorns Advisers, Acorns Securities, and Acorns Pay are subsidiaries of Acorns Grow Incorporated (collectively “Acorns”). “Acorns,” the Acorns logo and “Invest the Change” are registered trademarks of Acorns Grow Incorporated. Copyright © 2021 Acorns and/or its affiliates.

NBCUniversal and Comcast Ventures are investors in Acorns Grow Incorporated.