Worried about a recession? 7 tips to shore up your finances right now

Deborah Kearns| Quartz | August 2nd, 2025

Fresh recession fears have financial planners urging Americans to shore up their finances now while their incomes and jobs are stable

The economy has been sending mixed messages in recent months. But those messages got decidedly worse this week, with rising inflation and a brutal jobs report. It's making everyone a little jumpy.

With so much uncertainty in the air, financial planners are urging Americans to shore up their finances now while their incomes and jobs are stable. Here are some expert tips to get started.

Build a bigger emergency fund

The traditional rule of thumb of setting aside three to six months of living expenses for a rainy day may not be enough anymore. Travis Veenhuis, a certified financial planner with SGH Wealth Management in Lathrup Village, Michigan, recommends clients have "six to 12 months worth of expenses saved up in a safe and liquid place." That can be a high-yield savings account (HYSA) or a money market fund.

Start small: Even if you have nothing saved, don't let that paralyze you. "Even $5 a day can come out to over $1,000 a year in terms of additional savings," Veenhuis noted. "Just starting is the most important thing."

Don't panic about your portfolio

"If you had a plan in place already geared towards meeting your longer term financial goals, I would say that changing substantially your risk tolerance or selling off substantial amounts of stock in those moments is a huge mistake," Veenhuis said.

He pointed out that the average stock market return for the U.S. two years following a recession's start is "actually a positive 8.8%."

Focus on what you can control: budgeting and spending

Veenhuis suggested looking at auto expenses and travel as potential areas to cut back. The goal: live within your means and "adopt a lifestyle that really aligns with your income," he said. If you make those sacrifices and end up losing your income, "you weren't overspending in the first place," he added.

Next steps

"A lot of that work is done early in terms of preparing yourself for a moment like that," Veenhuis said. "Take adequate steps in the meantime to build up those healthy emergency savings funds, pay off that high interest debt, keep up to date with your resume, add new certifications. All of those factors combined are going to get you through the bumpy road ahead."