The National Bureau of Economic Research defines a recession as a significant decline in economic activity lasting more than a few months, typically involving two consecutive quarters of GDP decrease. Currently, 22 states and Washington, D.C. are experiencing a recession, with potential for the entire country to follow suit.
States like Connecticut, Georgia, and Illinois are among those struggling due to slumping farm economies and manufacturing industries. California and New York are in a precarious position, not in a recession but not growing either. President Trump’s policies are cited as contributing to the economic challenges.
Economist Mark Zandi’s assessment of state recessions differs slightly from the NBER’s due to limited state-level data availability. Zandi’s insights are based on his judgment, but his concerns should not be ignored. Financial preparation is key as more states may face economic decline, potentially leading to a nationwide recession.
Experts recommend having 3-6 months of expenses saved in an emergency fund, but 42% of Americans lack this safety net. Creating a budget, setting up a high-yield savings account, and paying off high-interest debt are crucial steps. Alternative investments like real estate, gold, and art can provide additional financial security during a recession.
Investing in a Wealthfront Cash Account can offer competitive rates and high liquidity for emergency funds. Similarly, a gold IRA with Thor Metals provides tax advantages and protection during economic uncertainty. Fractional ownership of rental properties through Mogul or investing in art with Masterworks are alternative asset options to consider for diversification.
Preparing financially for a potential recession includes paying off debt, boosting emergency savings, and exploring alternative investments. Engaging in side hustles, maintaining good credit, and considering real estate, gold, or art investments can help safeguard against economic downturns.
Remember to consult with financial advisors and conduct thorough research before making any investment decisions.
Read more at Yahoo Finance: Economist Mark Zandi says 22 states are already in recession based on 2 clear indicators. How to protect yourself now