A self-made millionaire shares her top 18 ‘recession money rules’: It is ‘reasonable to be worried’

Are you worried about what your finances will look like in a year or two? It is reasonable to be concerned about a possible recession.

If there is a recession in the next six to 12 months, you need to start preparing now so that you are in the best position with your money.

I encourage everyone I meet to remember that a recession can provide opportunities to get your finances in order.

Here are my top 18 recession money rules.

This is the first thing. An emergency fund of 12 to 24 months is needed. Saving for three to six months of living expenses is recommended by experts.

Workers should aim for 12 to 24 months if they are laid off, according to Catherine Valega.

She told CNBC in May that she doesn't think that's enough and that she tends to be more conservative than others.

There are two High-interest debt should be minimized. Call your card issuer to see if you can get a better interest rate. Do you have a good history of on-time payments or have been with them for a long time?

You can transfer your debt to a lower interest rate card if a rate reduction isn't an option. If you consolidate your debts, you'll be able to free up capital in the event of an emergency.

There are three. Prepare to take out a loan. Many people need to borrow money during a time of economic hardship. It's more difficult to get approved for a loan when interest rates are high.

A plan to increase your credit score is necessary. It is important to make payments on time and keep balances low in order to build credit.

There are four. Don't let your credit accounts go inactive. It's not a good idea to cancel your credit cards right now. Your credit score is influenced by the age of your accounts Credit cards can be used even if you transfer balances.

Credit scores from 668 to 699 are fair, 670 to 739 are good, 740 to 799 are very good, and 800 and up are excellent according to the company.

There are five. Renegotiate if your mortgage is close to term. Since last year, the average 30-year fixed mortgage has increased. If you lock in a lower rate now, you'll be protected if rates go up.

There are six. Stay put if you have low interest mortgage debt. People think paying off debt during a recession is a good idea. I don't recommend that. Minimum payments may be better for cash accessibility.

What's the reason? If the worst happens and you lose a source of income, the money you have saved can be used to recover expenses.

There are seven. If you can afford it, buy in large quantities. If inflation continues, you will be able to save even more money if you use cost savings today.

Great bulk purchases include non-perishable items such as toilet paper.

There are eight. Don't go for fresh produce. Buying frozen fruits and vegetables is a good idea. The products found in the freezer section are often just as healthy and cost less.

There are nine. Buy from generics. Garbage bags, lightbulbs, paper, makeup, pet food, canned goods, and other items can often be purchased at a lower cost and are often the same item.

There are ten. The cost of gas is something to consider. calculate how you can take on more than one errand in one outing If there is no cost delivery on a product, you should order it instead of going to pick it up.

There is a new date for the 11th. Before investing in the dip, build your emergency fund. Don't invest until you have an emergency fund. A loss of income can lead to debt and high interest debt.

Invest in industries that are resistant to the economic downturn. The fear of buying the wrong stock can be mitigated by investing in well known businesses. Consumer staple, utilities and healthcare are sectors that do well in an economic downturn.

Jim Cramer, host of CNBC's " Mad Money", told viewers in June that during a recession, he would advise them to buy "tangible" stocks.

He said that food stocks can be recession-proof. General Mills is one of his favorites.

13th Negative correlations are something to look for. Invest in asset classes that have low or negative correlations. One asset class will go up in value while the other goes down, so this can help minimize the amount of money you lose in the short term.

The 14th. If you're considering a career change, look for recession-proof jobs. Some jobs are more secure during a recession than others.

Medicine, teaching, law, accounting, public safety, utilities, waste management are some of the jobs that keep society going.

There are fifteen. Additional income can be created. Loss of income is a big risk for consumers during a recession. It's a good idea to take on another job. There are a lot of job openings right now and you can find a second job with flexible hours.

You can start a side hustle through ride-sharing companies. A predictable stream of income can be made by renting out your property or even a vacant room in your home.

A new date has been added. Do you want to sell your stuff? Second-hand sellers made a lot of money during the recession. You can sell items you don't use anymore. You can post items online to cut out the middleman.

17th Your market value should be increased. During a tight job market, you will be more attractive to potential employers if you improve your skills. The soft and hard skills you learn will add a lot to your resume.

There is a new item on the market. Recessions don't last forever. You can always recover your money if you lose your job or income. The average recession lasts about 15 months.

iFinance is the parent company of Medicard, Petcard, Dentalcard, and i Finance Tech. She obtained her masters degree in management from the University of Toronto.

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