Recession in the USA: What to Expect and How to Prepare?
A recent Bank of America survey showed that more than half of fund managers expect a recession in the United States in the near future. Increasingly, economists and financial experts are raising the possibility of an economic downturn that could happen soon. What does this mean for ordinary people, and what measures can be taken to avoid losses in the event of a recession?
Preparing for a recession in the US: economists’ forecasts, stagflation risks, and measures to minimize losses. Accumulating an emergency fund, reducing expenses, and investing in reliable assets are key strategies for preserving personal finances during an economic downturn. In this article, we will discuss all of these topics.
In addition to recession expectations, fund managers have also spoken about the possibility of stagflation this year. Stagflation is a situation where the economy is in a state of stagnation or recession, but inflation continues to rise. This could lead to instability in financial markets and a worsening of the economic situation in the country.
Rising interest rates
Most fund managers predict that the US Federal Reserve will raise interest rates to 5.25-5.5% by the end of 2023. This could lead to higher borrowing costs and a slowdown in economic growth. However, there is disagreement about when the Fed will start taking action to address inflation and economic downturn issues.
How to prepare for a recession?
In the event of a recession in the US, many people may experience negative consequences on their finances. However, there are several measures that can be taken to reduce losses:
- Accumulate an emergency fund. This can help weather a temporary deterioration of the economic situation and avoid a crisis in personal finances.
- Reduce expenses. In the event of a recession, many people reduce their spending on necessary goods and services. Therefore, if you start saving in advance, you can reduce your expenses and save money for essential items.
- Invest in reliable assets. The time of a recession may be favorable for investing in certain assets, such as gold, silver, or real estate. However, it is important to remember the risks and not invest all savings in one asset.
The current economic situation in the US is causing concerns for many economists and financial experts. However, there are measures that can be taken to reduce losses in the event of a recession. It is necessary to monitor the market situation, save money, and invest in reliable assets to preserve personal finances in an unfavorable economic situation.