5 Money Moves for When You Have Zero Confidence in the Economy
For many people, feeling confident about today’s economy seems like a fool’s errand. They’re spending a king’s ransom on vegetables and watching their 401(k)s like they’re front-row at a horror movie. But unless you stumble upon a magic lamp, you can’t fix the global economy overnight. Instead, focus on money moves closer to home.
Curious about the steps people can take to protect themselves and their money amid economic uncertainty, MoneyLion spoke with experts. Here are five moves you can make right now.
1. Don’t Panic
When headlines forecast economic doom, it’s only natural to want to crash out (as the kids say). But Daniel Gleich, board member and shareholder at Madison Trust Company, says panicking is the worst thing you can do.
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“Having a reactionary response to financial moments can be disadvantageous, as your decision-making tends to be based on emotion rather than rational assessment,” he said. “Performing adequate due diligence on any opportunity that arises is paramount.”
Don’t make rushed decisions out of worry for your portfolio or fear of missing out on a so-called “once-in-a-lifetime” opportunity. Take a break. Review the facts. Talk with a trusted expert.
2. Take Protective Measures
Gleich also advises ensuring your emergency fund can handle sudden, unforeseen events — and keeping that money in a high-yield savings account. He sees the emergency fund as part of a broader plan to fortify your finances in tough times.
“In tandem, review your investments and consider reallocating if you have overconcentration in one asset class,” he said. “Your priority should generally be to protect cash tied to essential expenses and any investments that are liquid.”
Meanwhile, work to minimize high-interest debt whenever possible, especially balances that compound quickly and strain your monthly budget.
3. Diversify Your Portfolio
As you build your financial fortress against economic uncertainty, Gleich encourages prioritizing long-term growth investments with an appropriate level of risk for your goals and timeline — which often includes diversification.
Beyond spreading investments across industries and companies, consider diversifying the types of investments you make. Gleich points to real estate as one option.
“If most of your investments are tied to Wall Street products, private investments that create predictable, steady cash flow can help diversify your income,” he said. “Examples include private lending, residential real estate with reliable tenants, or established private businesses.”
Keep in mind that private investments can carry additional risks, reduced liquidity and higher minimums, so careful research is essential before committing funds.
4. Prioritize High-Interest Debt
Debt can make you feel especially vulnerable during an economic downturn. Dom Farnell, co-founder and investment strategy lead at The Investors Centre, says one of the best ways to secure your finances — and peace of mind — is to prioritize certain kinds of debt.
“Repaying high-interest debt can boost confidence by reducing the pressure of monthly payments, which helps avoid panic,” he said.
Farnell advises focusing on two types first:
Credit card debt, payday loans and other high-interest personal loans
Variable-rate debt that could “get worse at any time”
He adds that moderate fixed-rate debt can be evaluated more calmly and analytically.
5. Avoid Certain Purchases
Farnell also recommends steering clear of purchases that add irreversible fixed costs to your budget. Now is not the time to upsize your home or splurge on a fancy car.
“You don’t want to be trapped in major debt, especially when the future feels uncertain,” he said. “Uncertainty is when you want optionality, not commitments that lock you in.”
The Bottom Line
Economic uncertainty can make anyone anxious. But you don’t have to be helpless. Taking proactive steps — protecting your cash reserves, paying down high-interest debt, diversifying thoughtfully and avoiding long-term financial commitments — can help you stay calm and in control, even when the broader economy feels anything but stable.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal, or tax advice.
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