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50 ways to survive the next recession
Jeanine Skowronski
April 07, 2025
Recession warning signs are flashing, well, everywhere, following the escalation of the Trump administration's trade wars.
It's too soon to tell if one will officially come to pass. Recessions are formally defined as two consecutive quarters of negative gross domestic product (GDP) growth, so you're sort of not in one until you're in one.
Still, a little preparation can go a long way, not just in terms of alleviating financial hardship but also undue stress. Here are 50 ways to survive the next recession (whenever it may be).
Pre-emptive steps
These money moves are always a good idea, though, fair warning, some are easier to execute before a recession hits.
1. Open a high-yield savings account
An emergency savings account is your best bet for getting through an economic downturn unscathed. Aim to bank enough to cover at least three-to-six months worth of expenses in an account with a competitive annual percentage yield (APY).
To be fair, the guidance on emergency savings is changing, with many experts arguing you need up to two years' worth of funds stored away, but, if you’re starting from scratch, a smaller initial goal could feel less daunting.
2. Automate savings
Set up direct deposit so a set amount of your weekly, monthly, or bi-monthly earnings rolls directly into your high-yield savings accounts.
3. Put windfalls toward your emergency fund
Potential sources of bonus funding include your yearly tax refund, annual or quarterly work bonuses, and unclaimed property. You can see if you have “missing money” via the National Association of Unclaimed Property Administrators’ website.
4. Learn your state’s unemployment laws
Most states allow you to collect benefits for up to 26 weeks with weekly payments based on a percentage of your earnings in a specified period (usually 52 weeks). Check your state's unemployment website to determine what assistance you can expect in the event of a layoff.
5. Understand how much money you have going out
Full-scale budgets are becoming passé (for good reason), but make sure you understand what you spend in any given month, particularly on non-discretionary expenses.
That way, you’ll know the amount of money you’ll need coming in to cover major bills following a job loss — and how much of those bills your state unemployment benefits might cover.
6. Eliminate bloat
I'm pro-spending in good times, but odds are, you're currently paying for some stuff you either (a) no longer use or (b) could get a much better deal on. Review your credit or debit card statements to identify and eliminate expense bloat. Case in point …
7. Re-shop for car insurance
You can often score a lower car insurance bill by requesting new quotes and switching insurers every six months. (See how my husband and I lowered our monthly car insurance payments by 56% in one simple step.)
8. Secure deals on other monthly bills
Pursue better prices on everyday household expenses. Options include:
Bundling home and auto insurance
Canceling streaming subscriptions (sometimes, they'll offer a discounted price to get you to stay)
Calling retention departments to ask about new deals or packages
Making minor energy-efficient upgrades to lower utility usage
Seeing if credit score improvements qualify you for lower rates on a credit card
Switching phone plans or carriers
9. Pay down high-interest debt
You'll want to avoid getting stuck with a big, expensive balance if cash-strapped. Focus on paying back "bad debts," like credit card balances or high-interest personal loans, while you have the funds. Utilize strategies like balance transfer credit cards, debt consolidation loans, or the debt snowball or avalanche methods.
10. Negotiate with creditors
You can sometimes secure a lower interest rate, waived fees, or a more favorable repayment terms on outstanding balances. A lender might even agree to a lower balance if you agree to pay what you owe right away.
11. Review and diversify your investments
Make sure you have the right mix of risky vs. relatively stable investments. You can follow a few suggested rules of thumb, including the 60/40 portfolio rule or holding "100 minus your age" in stocks. Ultimately, you'll want to factor in your financial standing and risk tolerance.
12. Keep up retirement contributions
Many financial planners suggest saving 15% of your pretax income each year for retirement, including any employer contributions — a good goal to work toward while money is coming in.
13. Consider new income streams
I'm hesitant to say "get a side hustle" because no one should have to work two jobs, and many go-to gigs underpay. Still, I've found it helpful to at least brainstorm sources of supplemental income in times of economic uncertainty.
And, even if you don't plan to, say, AirBnB your home or offer freelance services through Fiverr or Reedsy right away, it can't hurt to familiarize yourself with or apply to get onto any preferred platforms.
14. Sell second-hand goods
Again, don't read this as “sell your beloved stuff” so much as "make money off the gently used items taking up valuable closet space." Popular resale marketplaces include Poshmark, Mercuri, eBay, ThredUp, and TheRealReal (for luxury goods).
15. Check your credit
A high score is handy in good and bad economic conditions. You can see where you stand for free every 12 months by requesting your credit reports through AnnualCreditReport.com.
Several personal finance sites, including Credit Karma and Credit.com, also furnish a free version of your credit score each month.
16. Work on your score(s)
You can improve a so-so credit rating by paying down big credit card balances (and other debts), disputing credit report errors, ensuring all loan payments are on time, and limiting new credit applications in a short period.
17. Set up auto-pay
That way, you don’t inadvertently miss or make a late payment on a major bill, which will help you avoid late fees and damage to your credit score.
18. Brush up on your personal finance
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If you sense a layoff coming
Full disclosure: Most of these moves aren't meant for the boom times, but they'll help in a pinch.
19. Hoard vacation days
Some states or company policies require the payout of accrued paid time off (PTO) after a termination — and having those days paid out as part of your severance can give you additional runway if a layoff comes to pass.
Keep in mind this strategy won't apply if you work for a company with unlimited PTO — which is why many workers consider this benefit overrated.
20. Lower or pause your 401(k) contributions
This move is admittedly not ideal, especially if your employer offers a match, but if you're worried about short-term cash flow after a layoff, it could help beef up an insufficient emergency fund.
21. Adjust your tax withholding
This move can also increase short-term cash flow — and makes financial sense if you suspect you'll earn less this tax year than previously expected.
22. Consider new job prospects
You may be able find a role at a company better equipped to weather or grow during an upcoming downturn. At the very least …
23. Update your resume
Take a pass at your website, LinkedIn profile, and other social media handles, as well, to ensure you're application-ready.
24. Tighten your spend
Now’s the time to avoid big buys (unless absolutely necessary) and limit discretionary spending to bolster your emergency fund.
25. Avoid new debts …
Put off large purchases that require the use of a new credit card, personal loan, auto loan, home equity loan, or home equity line of credit (HELOC).
26. … and long-term commitments
Opt for short-term leases or service contracts in case you need to relocate for your next position.
27. Redeem credit card rewards
You can typically use points or cash back as credit card statement credits or even deposit earnings directly into a checking or savings account — another step that can put extra money into your emergency fund.
If you are laid off
These immediate measures can help you weather a period of unemployment.
28. Apply for unemployment ASAP
There's usually a lag between when you get approved and when you can start collecting benefits.
29. Set up reminders to certify for benefits
Depending on state law, you must certify or claim benefits weekly or bi-weekly to receive payment. Set up a calendar alert so you remember to do so while eligible.
30. See if you qualify for Medicaid …
Eligibility varies by state but can apply to adults who make less than 100% to 200% of the federal poverty level (FPL). The Kaiser Family Foundation has fact sheets on who can get Medicaid or Children's Health Insurance Program (CHIP) insurance in each state.
31. … or Affordable Care Act (ACA) subsidies
If you aren’t eligible for Medicaid, you might qualify for ACA marketplace plan subsidies. Healthcare.gov can help you determine your options.
32. Consider COBRA
The Consolidated Omnibus Budget Reconciliation Act, or COBRA, allows you to stay on your former employer’s group health plan for at least 18 months. This option is pricey, however, given you have to pay your premiums without an employer’s contribution.
33. Ask to have your student loan payment lowered or deferred
Federal student loan borrowers are usually eligible for relief in the event of a job loss. For instance, you can apply for an income-driven repayment plan on the Federal Student Aid website.
34. Utilize your network
Studies suggest that most jobseekers find their next role through their network these days, so lean on your connections to resume employment sooner rather than later.
35. Know where to find free resources for jobseekers
If you're looking for modern job search tips, I'm a big fan of The Job Hopper substack, run by bonafide career experts Allison Doyle and Jen Hubley Luckwaldt.
In case of emergency
Consider these steps if a lack of emergency funds leaves you in dire straits or you experience a prolonged period of financial distress with similar consequences.
36. Think about downsizing
A smaller home or rental unit represents less of a financial obligation, not just with rent or a mortgage, but utility costs. Other ways to downsize include:
Going from a multi-car to a single-car household
Lowering insurance coverage or benefits (if you're driving less, you probably need less car insurance)
Reducing your digital footprint and opting for cheaper, less robust cable bills or cellphone plans
37. Mull a retirement delay
Stock market downturns can shrink a new retiree’s nest egg, so if you have a flexible timeline, consider waiting a year or two to exit the workplace. (A professional financial planner can help you better understand your best path forward.)
38. Prioritize payments
Some bills are more urgent than others. For instance, you’ll want to pay for housing before making more than the minimum on your credit card each month. When in dire straits, focus on bills that cover your basic needs — namely, food, shelter, and health (insurance) — and secured debts (like an auto loan or mortgage).
39. Get a zero-interest credit card
Credit cards with 0% financing offers on purchases and balance transfers could buy you time to pay back balances or existing high-interest credit card debt. The best ones offer between 15 to 21 months of 0% financing before the regular APR starts.
40. Explore retirement fund hardship withdrawals
You can tap an existing 401(k) or individual retirement account (IRA) in a pinch. However, there are better (and worse) ways to take one. Bankrate has a good guide to common options and their big drawbacks.
41. Apply for government help with your housing payments
Most states have programs that help struggling homeowners with their mortgage payments in times of economic crisis. Find and contact your state’s housing finance agency to learn about your options. Note: Many local governments offer similar assistance to renters.
42. See if your lender offers mortgage assistance
Contact your lender directly, as many financial institutions also offer forbearance or loan modifications to help borrowers avoid foreclosure.
43. Seek out additional government aid
Unemployment isn’t the only government-funded program that can help people who’ve experienced prolonged economic struggles. You might also qualify for:
44. Know your debt relief options
They include debt consolidation, credit counseling, debt settlement, debt management plans, and, yes, in extreme cases, bankruptcy. Learn more about these and other debt-relief options on the Federal Trade Commission (FTC) website.
While we’re in a recession
These tips apply whether you’re surviving or thriving during a downturn.
45. Stay informed
Right now, fears of a coming recession are tied to the ongoing trade war and its effects on inflation, so it can help to understand what products are seeing the most significant price increases — and which retailers are absorbing them (at least a little) vs. entirely passing them along to customers.
46. Ignore your 401(k)
Financial experts generally recommend staying invested. What goes down inevitably comes back up, and if you pull money from your accounts, you're effectively locking in losses.
47. Avoid sequence risk
If you are about to retire or are newly retired, you'll want to avoid sequence risk, where poorly timed retirement account withdrawals can lower your overall return rate — and the longevity of your portfolio. Consult a financial professional to devise a strategy that won't unduly eat into your nest egg.
48. Upskill
Pursue industry-specific credentials, certifications, virtual training, and mentorships to make your career more recession-proof.
49. Remember self-care …
Inexpensive ways to disengage and decompress include nature walks, meditation, warm baths, and free museum visits.
50. … but don’t worry about Recession Hair
Everyone’s already got some.
Check back next Monday for the next edition of our Weekly Top 50 and sign up for the Money As If newsletter to have swaggy thirst traps, bougie hacks, and end-of-the-world personal finance tips delivered to your inbox every Friday.
This article is for educational purposes only. We don’t recommend or advise individuals to buy, not buy, sell, or not sell particular investments or other assets, as everyone’s circumstances are different. Also, it’s your money and ultimately up to you to decide the best use for it.