2020 started as a promising year for the economy, with stocks being traded at an all-time high and consumers feeling good about their finances. Unfortunately, the blue skies didn’t last long as the global coronavirus pandemic created dark clouds of uncertainty that brought many economies to a standstill. Due to our current situation, many experts fear that our economy is falling into a recession. Whether it does or not, it’s important to take measures in preparing your finances to be able to handle the weaker economy that we are now living in. Here are some financial strategies to help you weather a recession.

How to Prepare Your Finances for a Recession

· Consider Refinancing Your Mortgage

· Lower Your Credit Card Interest Payments

· Save Your Money

· Implement A Budget

· Eliminate Your Debt

Consider Refinancing Your Mortgage

Now is the perfect time to refinance your mortgage, as the average 30-year fixed-rate mortgage hit a record low in early March. Financial experts recommend only refinancing your mortgage if you’re able to get at least a 0.5% – 1% drop in your current rate. 

Lower Your Credit Card Interest Payments

Credit card interest rates are linked to the prime rate, which will drop when the Federal Reserve cuts rates. This happened in early March, so you’re more likely to get a better deal now. If you’re planning on shifting your debt to a new card, consider applying for a balance transfer credit card so you won’t be charged for the moving fee.

Save Your Money

Not being able to go out to restaurants and other public places isn’t an ideal situation, but it’s one that can save you a lot of money. Figure out how much money you would be spending on going out to eat, attending social events, etc., and add an equal amount to your savings. Doing this will not only contribute a good chunk of change toward your future but also will allow you to figure out exactly how much you’re spending on things that could be reduced when life starts getting back to normal.

Implement A Budget

If you’ve never given budgeting a shot, or have and decided not to continue with it, now’s a great time to give it another go. Budgeting can give you a precise idea of exactly how much you should be spending on a given factor, allowing you to customize an ideal plan for yourself depending on your needs. If it’s your first time budgeting, take it slow and figure out a plan that will work for a short time period, like a month, before moving forward. This will give you room to make future accommodations and figure out exactly how much you’ll need to spend in a certain area.

Eliminate Your Debt

Now is the time to try and settle your outstanding debt, as many are in a more forgiving and graceful mood. The financial experts at Progressive Debt Relief are equipped to help you settle debt painlessly and discreetly by negotiating with your lenders to reach a repayment solution that works for you. We offer free consultations and no upfront fees to make sure you are in the best place to receive our services. To find out more about what we offer or to schedule a free consultation, contact us today.