A woman buys chicken at a supermarket in Santa Monica, California on September 13, 2022.
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For those who fear a recession is coming, the only question is when.
In fact, many economists and CEOs expect a recession May be on the horizon this year
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A recession is traditionally defined as two consecutive quarters of declining economic growth. It is measured by a decline in Gross Domestic Product (GDP). This is a measure of a country’s output in value of goods and services.
The US economy ended 2022 with positive GDP, according to new government data. From October to December GDP rose by 2.9% annual pace.
But economic risks still loom. Growth may also be putting the brakes on as the Federal Reserve raises interest rates to keep inflation in check.
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Experts aren’t the only ones worried about a recession.
Nearly half (46%) of US adults believe the country is already in recession. Recent Morning Consult Survey found. Meanwhile, 25% expect such a recession within the next year.
“We’re not officially in a recession,” said Amanda Snyder, financial correspondent for Morning Consult.
“But if people feel their money is not progressing as it used to be or their income is declining, they are personally experiencing a financial depression,” she added. .
The survey found that 31% of the more than 2,200 respondents have started taking steps to prepare for a recession.
Meanwhile, a mid-January survey found that half (50%) of U.S. adults have not started preparing for a recession, but wish they could.
The remaining 19% say they are not prepared because they don’t want or need to.
Those with incomes above $100,000 were most likely to take steps to protect their finances, at 41%. Subsequently, he is 39% of those who earn $50,000 to $100,000. Of those making less than $50,000 a year, he was 24% the least likely to have started preparing.
Experts say there are several ways to normalize your finances right now.
1. Spend less
Indeed, record high prices at grocery stores can make it difficult to cut back on food costs.
However, it is possible to look for ways to cut back to make room for other financial goals.
Certified Financial Planner Ted Jenkin is CEO and Founder of oXYGen Financial CNBC Financial Advisor Council, 21 day budget cleanse recommended Find ways to cut spending.
Shop every bill in your home for 21 days to see if you can get a better deal.
2. Increase your emergency savings
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Having a little more cash in reserve can help ensure that unexpected events like car repairs or unexpected bills don’t drain your budget.
yet survey show Many Americans would struggle to cover the $400 expense in cash.
Experts say automating your savings is the key, not even having money in your paycheck.
“Even if you get through this period relatively unscathed, that’s why you keep saving,” said Mark Hamrick, senior economic analyst at Bankrate.com.
“I have yet to meet anyone who saved too much money,” he added.
3. Reduce your debt balance
Rising interest rates will increase your debt repayments, but you can control that by paying off your balance, says Matt Schulz, chief credit analyst at LendingTree. previously told CNBC.com.
“It really bothers people that inflation is picking up so fast,” Schultz said.
But certain moves could help individuals control interest rates, he said.
If you have a monthly balance on your credit card, try to pay off that debt with either a 0% balance transfer offer or a personal loan.
Alternatively, you can ask your current credit card company to lower the interest rate.
