6 Types of People Who Can Financially Survive a Recession
There’s been a lot of talk lately about a possible recession amid economic uncertainty, tariffs and market volatility. If this happens, it’s important to be prepared.
Certain groups of people may be more likely than others to weather the storm of a recession. Now is the time to figure out whether you’re in one of these groups, and if not, to see what you can do to prepare.
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Keep reading to learn six types of people have a good chance of making it through a recession.
Also see five recession money rules to start following now.
“The ‘resilient six’ tend to have one or more of the three key recession survival traits — stable income, low fixed costs or flexibility,” said Kyle DePaolo, principal at DePaolo & May Strategic Wealth. But who exactly falls into these six groups? Here are the six groups that could thrive in a recession, per BlackDoctor.org.
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Young adults
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Renters
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People living on a fixed income
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Essential workers
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Investors
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Businesses with low operating costs
Consistent cash flow is the key for fixed-income earners and essential workers, DePaolo said. As for investors, they must stay liquid, harvest losses and turn economic volatility into opportunities — especially in quality market segments.
“Renters can relocate or renegotiate and agile businesses can pivot quickly or operate with lean overhead,” he said. “Ultimately, resilience comes down to predictability, adaptability and access to opportunity.”
But if you’re not in one of these groups, don’t worry Here are some tips that can allow you to better position yourself for a recession.
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Your career is composed of a variety of moving parts, so DePaolo advised breaking these skills up into monetizable parts.
“A corporate marketer might freelance on content, strategy or course creation,” he said. “Multiple small income streams can match or beat one big paycheck — and provide more buffer.”
Become more than just an employee. You might not have a financial stake in the company, but you can become invaluable to your boss by taking an active role in helping the business thrive.
“Pitch cost-saving ideas or new revenue streams at your current job,” DePaolo said. “Employees who help their company stay lean often survive layoffs — and may get promoted.”
If you have good credit, DePaolo advised opening a home equity line of credit (HELOC) or a business line of credit before it’s needed. He said this can be a good idea for two reasons: It’s easier to get credit before you actually need it, and a recession could tighten lending.
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