The markets are tumbling, again — how can you recession-proof your finances?

U.S. markets are in disarray again, after the Donald Trump’s tariffs announcement last week and a rogue tweet sending a panicked market into a buying then selling whirlwind Monday.

Is it time to start panicking about the impending financial apocalypse? In short, no. But it may just be time to start building a plan so that you are ready, should a recession happen.

That’s the advice of personal finance influencer Vivian Tu, better known as YourRichBFF. A former Wall Street trader, Tu now heads up her own financial education and advice company — and recommends we all take a deep breath.

“The word ‘recession’ almost sounds like a swear word. It’s so fear-inducing,” she tells The Independent. “And that is a normal feeling when things are going badly. However, first and foremost, we need to remember that a recession is a normal part of an economic cycle. There’s boom, bust periods, and then there’s the dip, and then the recessionary period.”

With global markets in disarray the time is nigh for consumers to consider personal plans for what to do should the worst come to the worst

With global markets in disarray the time is nigh for consumers to consider personal plans for what to do should the worst come to the worst (EPA)

While a recession may not be as terrifying and scary as feared, she says, there are immediate things that consumers should be thinking about in case of unforeseen and more near-term challenges.

One thing is to make an emergency fund. In times of economic uncertainty Tu encourages people (if they are able) to set aside a larger emergency fund than normal. She recommends trying to set aside three to six months wages in a high-yield savings account to cover necessities such as rent, basic groceries, and other add-ons to make ends meet. Banks have Federal Deposit Insurance Corporation insurance, meaning if the bank collapses, your money (at least up to $250,000 of it) is protected by the government.

She does not recommend stashing it in cash, however.

Finance influencer Vivian Tu encourages people to set aside a larger emergency fund than normal. She recommends trying to set aside three to six months wages in a high-yield savings account to cover necessities such as rent, basic groceries, and other add-ons to make ends meet

Finance influencer Vivian Tu encourages people to set aside a larger emergency fund than normal. She recommends trying to set aside three to six months wages in a high-yield savings account to cover necessities such as rent, basic groceries, and other add-ons to make ends meet (Getty Images)

“I’m certainly not stowing thousands upon thousands of dollars away in my home,” she tells The Independent. “One, because they’re getting eaten away by the cost of living and inflation, and two, they’re not protected in the same way that they would be in an entity. It’s okay to have a little bit in your house, but don’t start stuffing money under your mattress like grandma did.”

Such periods of economic uncertainty can also be ideal times for self-audits, Tu says. There’s no need to stop every purchase that brings you joy, but tightening the belt a bit is good practice.

Registering receipts from grocery shops on cash-back apps, which offer users the opportunity to earn money back on purchases by scanning receipts, linking credit cards, or shopping through their platforms, can also be a useful tool, even if it’s only saving $5-10 per shop.

“That adds up over time,” Tu says.

Vivian Tu, known online as YourRichBFF has a history of working on Wall Street and now heads up her own financial education and advice company

Vivian Tu, known online as YourRichBFF has a history of working on Wall Street and now heads up her own financial education and advice company (Brendan Wixted)

Another big drain on personal finances is personal debt. “It’s never great to have high interest rate debt, but it’s especially not good during a period like this, because you are going to feel the weight of those debt payments heavier on your wallet when there’s just less money to go around and things cost more,” Tu says.

“I always say, if you have high interest rate debt, make it a priority to pay that off. Anything above 7 percent you really want to get that paid down ASAP.”

Perhaps counter-intuitively, now may also be the time for investments. The confidence that markets will inevitably bounce back means that sensible inroads in a diversified portfolio while prices are low can ultimately come up trumps for consumers.

“The stock market is the only place where when things go on sale, people run,” Tu says. “Have you ever run from a sale at a department store? No. People love sales, except when it happens in the stock market.”

“If you do have the funds to be investing, right now is certainly one of the best times to do it.”

Above all, Tu says, now is the time for conversation and planning around what to do if worst does happen — whether that’s losing a job, draining your savings or seeing your investments collapse — avoiding what she calls “paralysis by analysis.”

“My hope is that these conversations sit on a shelf and collect dust and cobwebs. But if, in a couple months time, something that you discussed does happen, aren’t you going to be so happy that you at least have a crayon outline of what your plan might be?” she says.

“You’re going to make better decisions now out of a place of security and comfort than you do the day something bad happens. So make a plan, have the plan, and hope you never have to use the plan.”



Source link

Visited 1 times, 1 visit(s) today

Related Article

Someone delighted by something on their phone.

3 Growth Stocks That Could Skyrocket in 2025 and Beyond

If bulls are winning back the market, these speedsters can help you stay ahead of your fellow investors. Stocks are starting to bounce back, and it’s probably a good time to take a look at growth stocks that can make the most of the market’s recent bullish turn. You probably have a few growth stocks

UK local elections: Starmer’s betrayal of voters is handing England to Reform

UK local elections: Starmer’s betrayal of voters is handing England to Reform

Reform, Nigel Farage’s populist right-wing party, has just swept local elections across the UK, while the Labour party – only 10 months after winning a majority in a general election – suffered its worst results in many decades.  “They’ve gone back on everything they said they would do for the working class,” said a female

Putin has not met a sitting U.S. president since he held a summit in Geneva in June 2021 with Trump's predecessor Joe Biden. (AFP)

Trump-Putin meeting is necessary, but no specifics yet: Kremlin | World News

May 05, 2025 07:43 PM IST Donald Trump will travel to Saudi Arabia, Qatar and the UAE later this month to take part in a summit with Gulf leaders. The Kremlin, asked on Monday about a possible meeting between US President Donald Trump and Russian President Vladimir Putin in Saudi Arabia, said that a meeting

Beware phony IT calls after Co-op and M&S hacks, says UK cyber centre

Beware phony IT calls after Co-op and M&S hacks, says UK cyber centre

Joe Tidy Cyber correspondent, BBC World Service Getty Images The National Cyber Security Centre (NCSC) has warned that criminals launching cyber attacks at British retailers are impersonating IT help desk calls to break into organisations. Hackers have targeted Marks & Spencer, Co-op and Harrods in the last two weeks, and on Friday the anonymous group

A Tower on NYC's Billionaires' Row Is Riddled With Defects, Tenants Say

A Tower on NYC’s Billionaires’ Row Is Riddled With Defects, Tenants Say

432 Park Avenue, the narrow 1,396-foot-tall residential skyscraper on New York City’s Billionaires’ Row, was advertised as an architectural marvel when tenants first moved in nearly a decade ago. Now those tenants say the luxury tower is beset by cracks, leaks, elevator malfunctions, and relentless noise. Unit owners have filed two separate complaints against the

According to NCS, the earthquake hit at a depth of 10 kilometres (NCS)

Earthquake of 4.2 magnitude hits Pakistan | World News

An earthquake with a magnitude of 4.2 on the Richter Scale hit Pakistan at around 4 pm on Monday, according to the National Center for Seismology (NCS). According to NCS, the earthquake hit at a depth of 10 kilometres (NCS) There were no immediate reports of any damage or injuries. According to NCS, the earthquake

Inside Washington

Tech site says Signal-like app used by Trump adviser was hacked

Sign up for the daily Inside Washington email for exclusive US coverage and analysis sent to your inbox Get our free Inside Washington email Get our free Inside Washington email A security breach in an unofficial version of the encrypted messaging app Signal has raised concerns about the vulnerability of communications within the highest levels

Struggles of displaced: Life in Gaza's makeshift shelters

Israel okays plan to intensify military operation in Gaza

Israel’s security cabinet on Monday approved plans to expand its military offensive in the Gaza Strip, according to public broadcaster Kan, and has begun calling up tens of thousands of its reserve soldiers. On Sunday, meanwhile, Yemen’s Houthi rebels launched a missile attack at Israel’s main international airport, Ben Gurion, hours before Israeli Prime Minister

Israeli Prime Minister Benjamin Netanyahu has blamed Hamas for "remaining an obstacle" in the face of a potential ceasefire deal in Gaza. (AP)

Israel approves plans to intensify military operations in Gaza | World News

The ministers of the Israeli Cabinet have approved plans to intensify military operations in the Gaza Strip, an official said on Monday. The ‘gradual’ plan involves claiming more territory in the Palestinian enclave, where Israelis already hold control over half the land, they added. Israeli Prime Minister Benjamin Netanyahu has blamed Hamas for “remaining an

New Zealand airport to remove Hobbit-themed eagle sculptures

New Zealand airport to remove Hobbit-themed eagle sculptures

Wellington Airport The giant birds will be unfastened from the airport ceiling to make way for a new mystery exhibit For more than a decade, a pair of Hobbit-inspired eagle sculptures have cast a watchful eye over visitors at New Zealand’s Wellington Airport. But the giant birds will be unfastened from the ceiling on Friday

Your memories as Microsoft shuts down the video calling service

Your memories as Microsoft shuts down the video calling service

Graham Fraser Technology reporter Owen and Weng Williams Skype would help change the lives of Owen and Weng Williams From blossoming long-distance love to helping families stay connected, for years Skype held a unique place in people’s hearts. In the days before Zoom, WhatsApp and Teams, the video call service was once one of the

President Donald Trump speaks with reporters after disembarking Marine One upon arrival on the South Lawn of the White House in Washington, Sunday, May 4, 2025. (AP Photo/Rod Lamkey, Jr.)

Trump Throws A Fit At Movie Industry With New Tariff Threat

President Donald Trump turned toward an unexpected target on Sunday as he warned the film industry to stop shifting productions overseas ― or else face massive tariffs. “The Movie Industry in America is DYING a very fast death,” the president wrote on his Truth Social website, noting that other nations are offering tax incentives to

Colombia's wind farms bring promise and pain for indigenous group

Colombia’s wind farms bring promise and pain for indigenous group

Catherine Ellis Business reporter Reporting fromLa Guajira, Colombia Catherine Ellis José Luis Iguarán says that the sound of the turbines disturbs his dreams When José Luis Iguarán steps outside his home in La Guajira, northern Colombia, he is met with a line of 10 towering wind turbines stretching across the cactus-strewn terrain toward the Caribbean

How the Vatican makes its smoke signal

How the Vatican makes its smoke signal

Lucy Clarke-Billings BBC News Chimney installed on Sistine Chapel ahead of papal election When the Catholic Church elects a new pope, the world watches not for a press conference or social media post, but for rising smoke from a small chimney atop the Sistine Chapel. If the smoke is black, no new pope has been

Members of Huthi-affiliated security forces stand guard in a vehicle during a rally in solidarity with Palestinians and the Gaza Strip and in condemnation of Israel and the US, in the Houthi-run capital Sanaa on May 2, 2025.

Yemen’s Houthis say US bombs capital after Israel vows revenge for airport strike

Members of Huthi-affiliated security forces stand guard in a vehicle during a rally in solidarity with Palestinians and the Gaza Strip and in condemnation of Israel and the US, in the Houthi-run capital Sanaa on May 2, 2025. MOHAMMED HUWAIS / AFP Yemen’s Houthi rebels on Monday, May 5, blamed Washington for around 10 strikes

0
Would love your thoughts, please comment.x
()
x