There may be a time where you go through all of your savings and so, before that happens, you want to set up a backup to the backup. So, you’ve heard the news: The Fed has raised interest rates. Listen, the stock market is going crazy, cryptocurrency is crashing, and there’s talk that we might be having a recession, so, I get that all of this is very scary. But can I just walk you through some steps that you can take to prepare, whether a recession comes or not? For example, you know, don’t be afraid of the bear market. You’ve probably been hearing it’s a bear market and it’s really scary, right? But here’s the thing: It’s an opportunity for you to buy stocks on sale and, if you’re dollar-cost averaging, you’re putting a little bit of money in, or however much that you have, on a regular basis, you can take advantage of the fact that the market’s down. And, speaking of market, you don’t want to try to time the market. I have people saying, “Well, I’m just going to jump out. I can’t take it. I’m going to just wait ’til things get better”. That’s the definition of timing the market. And here’s the thing: You have to know when you get in and get out at the right time. And nobody knows that. It’s impossible. So, just put the money in regularly, like you’re doing for your 401(k) plan. Another thing: If you have credit card debt, please get rid of it as soon as possible. It’s only going to get more expensive because interest rates are going up. Now, I need you to be a super saver right now.
Now, some of you are thinking, “I don’t have any extra”. I understand. But if you do, now’s the time to save, even if you’re doing okay, because we don’t know what’s going to happen. You want to be sure that you have stockpiled some savings. Now, you might also want to line up some backup emergency funds. So, what’s that? Like maybe you want to go ahead and apply for that home equity line of credit. Have it on the side. I don’t want you to use the debt, but, if things get really bad, at least it’s there, in place, in case you need it. And how about that side gig? Listen, lots of companies are looking for people. So, if you got some extra time, you got a main job, but maybe you’ve got some time on the weekend and some extra hours, go ahead and get that job and take that money and set it to the side and have it there, ready, in case something happens. And, look, don’t forget bonds! Everything’s all stocks now, but bonds help balance out your retirement portfolio, for example. It gives you some more safety than stocks. So, I know it’s all really scary, but guess what. If we do have a recession, it won’t last forever, so, if you follow some of these steps or all of these steps, you’ll be better prepared, in case we do have a recession.