Recession fears are on the rise.
Recessions may seem scary, but they don’t always last as long as we think and they usually give us a chance to get our finances in order before things really start to shake up. That’s why it’s important to take the time to consider your options and make sure you’re prepared for whatever comes your way. Having an emergency savings cushion can help you weather any economic storms, so it’s worth beefing up yours before the next recession hits. It’s also a good idea to diversify your investments, so you’re not as exposed to any one particular market.
As the stock market slides and consumer confidence tumbles, Americans’ pessimism is rising. More than half of adults now say they’re pessimistic or afraid about the economy, according to a new CNN/SSRS poll. And the percentage who believe a recession is coming in the next year is near its highest level since the Covid pandemic.
While a recession hasn’t officially been declared (the National Bureau of Economic Research makes that call), many experts have raised their recession probabilities in recent days. For example, Goldman Sachs recently upped its chances of a recession to 45% in the next 12 months and JP Morgan has upped its risk of a global recession to 60%.
While these concerns aren’t necessarily valid, it’s important to understand what a recession actually means and how it could impact your financial life. That’s why we’re working on a new measure of recession fears, which will be updated more frequently and provide real-time insight into how these anxieties are evolving.