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what should I do to prepare for recession?

paulpauper 5y ago
the best answer is often nothing. selling your stocks may mean selling at the bottom .recessions tend to be brief and the market will bottom before the economy does.
theandrewbailey 5y ago
Pay off debts (and don't get more). Too many people say 'take out loans, and buy investments with the savings!' They don't understand that debt is risk, and recessions are a big reason why. Stock up on food, medication, and other supplies.
- willcipriano 5y ago
  Given the government's tendency for bailouts recently that might be a losing strategy. Things like eviction holidays are happening more and more. I wouldn't get into debt needlessly, but if you need something in the next few years anyway, now might be a good time.
- dominotw 5y ago
  > Stock up on food huh? recession is that short?
  - frumper 5y ago
    Recessions are typically a few quarters to just over a year in the US. A well stocked pantry can go a long way to helping you supplement throughout the year.
  - dmingod666 5y ago
    You can stockup for 6 months fairly easily and by then you know the direction things are going. Mark dates on your supplies and use + reload them regularly. You will always have a 6 months buffer from when shit hits the fan.
jmyeet 5y ago
This really depends on how much money you have. It's a good general rule to keep a certain amount of money in cash or cash-like securities but there are limits to this. At a certain point, you lose out more on gains by keepin gmoney in cash than you'd lose by realizing losses to raise cash. If you believe in the long term future of your investments, the thing to avoid is a cash flow crunch. That's what cash on hand is for. Leveraged investments may face a margin call. That's fine if you believe in the assets and you can cover it. If you can't then you may be forced to sell low. Part of it too is psychological and being able to sleep at night. If you will suffer extraordinary stress by a 20% price correction then you're probably over-invested, just for your own wellbeing.
deleted 5y ago
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wonderwonder 5y ago
Really nothing out of the ordinary. Try to ensure you have a good amount of savings on hand and limited debt. Recessions while harsh are generally not long and are relatively common and likely the only way out of our current issue with inflation. Depressions are long and devastating.
tonyedgecombe 5y ago
Spend less than you earn, keep a decent amount of cash on hand (6 to 12 months spending). Don't job hop, often companies have a last in first out policy. Don't take on too much debt. Keep your skills up to date and make sure your management knows how much you contribute. During a recession companies are often looking for ways to cut costs so you need to change the way you market yourself to them. If you are an AWS expert for example then you might promote your ability to get AWS costs under control.

the best answer is often nothing. selling your stocks may mean selling at the bottom .recessions tend to be brief and the market will bottom before the economy does.

theandrewbailey 5y ago

Pay off debts (and don't get more). Too many people say 'take out loans, and buy investments with the savings!' They don't understand that debt is risk, and recessions are a big reason why. Stock up on food, medication, and other supplies.

willcipriano 5y ago
Given the government's tendency for bailouts recently that might be a losing strategy. Things like eviction holidays are happening more and more. I wouldn't get into debt needlessly, but if you need something in the next few years anyway, now might be a good time.
dominotw 5y ago
> Stock up on food huh? recession is that short?
- frumper 5y ago
  Recessions are typically a few quarters to just over a year in the US. A well stocked pantry can go a long way to helping you supplement throughout the year.
- dmingod666 5y ago
  You can stockup for 6 months fairly easily and by then you know the direction things are going. Mark dates on your supplies and use + reload them regularly. You will always have a 6 months buffer from when shit hits the fan.

jmyeet 5y ago

This really depends on how much money you have. It's a good general rule to keep a certain amount of money in cash or cash-like securities but there are limits to this. At a certain point, you lose out more on gains by keepin gmoney in cash than you'd lose by realizing losses to raise cash. If you believe in the long term future of your investments, the thing to avoid is a cash flow crunch. That's what cash on hand is for. Leveraged investments may face a margin call. That's fine if you believe in the assets and you can cover it. If you can't then you may be forced to sell low. Part of it too is psychological and being able to sleep at night. If you will suffer extraordinary stress by a 20% price correction then you're probably over-invested, just for your own wellbeing.

deleted 5y ago

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wonderwonder 5y ago

Really nothing out of the ordinary. Try to ensure you have a good amount of savings on hand and limited debt. Recessions while harsh are generally not long and are relatively common and likely the only way out of our current issue with inflation. Depressions are long and devastating.

tonyedgecombe 5y ago

Spend less than you earn, keep a decent amount of cash on hand (6 to 12 months spending). Don't job hop, often companies have a last in first out policy. Don't take on too much debt. Keep your skills up to date and make sure your management knows how much you contribute. During a recession companies are often looking for ways to cut costs so you need to change the way you market yourself to them. If you are an AWS expert for example then you might promote your ability to get AWS costs under control.