9 Steps to Prepare Yourself Now for the Next Recession

It's been nine years since the end of the Great Recession. The current economic expansion can't last. Take these steps to be ready to survive -- and thrive -- when it ends.

6. Pay down debt

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Keeping your debt low and your credit score high will make you more secure and better able to pounce when opportunity knocks, says Money Talks News founder Stacy Johnson.

Paying off debt now can also save you hundreds of dollars in interest payments later — and help improve your credit score.

A high credit score can save you money if you do need to borrow. Here is an example from Money Talks News’ mortgage rate search tool:

“Borrow $250,000 with a 30-year, 4 percent fixed-rate mortgage, and over the life of the loan you’ll pay $179,674 in interest. But increase the rate to 6 percent, and you’ll pay $289,595. That’s a difference of nearly $110,000 — enough to help you retire earlier, start a business or put your kids through college. In short, those measly 2 percentage points could change your life.”

If you need professional help with credit card debt, debt collectors or credit restoration, visit the Money Talks News Solutions Center.

7. Track your spending

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It’s easier to reach financial goals if you know where your money is really going.

With free money-tracking programs, you can view all your accounts in one place — checking, savings, retirement and more. Some also enable you to create budgets. YouNeedABudget is one option for such tracking.

8. Check your portfolio

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When was the last time you adjusted your 401(k) or IRA investments? Do you have too much money in stocks, especially if you’re near retirement?

Too many people had too much invested in stocks before the last economic downturn, Stacy warns. Consequently, many lost a good chunk of their retirement savings when hard times hit.

There’s no excuse for that, considering that rebalancing your investments portfolio can be done in less than 15 minutes.

9. Don’t wait

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By the time anyone declares we’re in a recession, we’ll be in one already. That’s one reason it’s good to prepare now.

Before a recession becomes official, there are warning signs. More important than watching for signs, though, is simply getting started preparing for the next downturn. It is inevitable.

What are you doing to prepare for the next recession? Share with us in comments below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

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