Viking Magazine - December 2022 - 11

of your monthly income on wants
(the 50% should be reserved for
needs, and the 20% for savings),
but you may want to be even more
conservative in a stressed economy.
RAMP UP YOUR SAVINGS. Take that
money you save by decreasing
your spending and roll it into
your emergency savings fund.
The rule-of-thumb stating you
should have three to six months of
expenses saved up still stands in a
recession, but now is the time to be
picky about where you store your
money. Look for high-yield federally
insured savings accounts that
cash when you need it is crucial
during a recession.
SNAPSHOT
PAY DOWN YOUR DEBT. Credit card
debt is a burden to your overall
financial well-being even in a
healthy economy, but add inflation
to the mix-which, in turn, causes
the Federal Reserve to increase
interest rates in order to curb the
rising prices-and debt becomes
even more difficult to pay off. That's
because most credit card APRs are
based on the Fed's prime rate. Aim
to pay off your balance in full every
month to avoid interest charges
entirely, and if you're struggling with
debt, consider paydown strategies
like consolidation loans and balance
transfers.
The rule-of-thumb
stating you should
have three to six
months of expenses
saved up still stands
in a recession, but
now is the time to
be picky about
where you store
your money.
earn rates better than the national
average (typically upwards of 1.5%
APY, compared to the 0.17% APY
of traditional savings accounts).
Avoid savings vehicles that don't
allow you to easily access and liquify
your money, such as a certificate
of deposit. Being able to withdraw
DIVERSIFY YOUR INVESTMENTS.
While it may be tempting to pull
all your money out of the stock
market as prices drop, experts agree
that's not a wise financial move
if you want to avoid selling your
assets for a loss. That's because,
historically, the stock market always
recovers. Instead, now is the time
to double-down on your investing
efforts while stock prices are low,
and diversify your portfolio with a
variety of investments like stocks,
bonds and mutual funds.
ALWAYS HAVE A PLAN B. Even with
ample recession preparation, it's
smart to have a couple of backup
plans. Brush up your resumé in
case you're laid off, start a side
hustle to beef up your emergency
funds and review your life
insurance policy with your Sons
of Norway insurance professional.
If you have a permanent policy
with cash benefits, you can borrow
against it to get through the lean
months. ▼
A recent Consumer
Financial Protection
Bureau report revealed
that most Americans
do not have the
recommended three to six
months of expenses saved
in their emergency funds.
EMERGENCY
SAVINGS
24%
HAD NO
EMERGENCY
SAVINGS
37%
HAD AT LEAST
A MONTH OF
INCOME SAVED
39%
HAD LESS THAN
A MONTH OF
INCOME SAVED
Sons of Norway, 1455 West Lake Street, Minneapolis, MN, offers financial products, but not all products are available in all states.
Products issued by Sons of Norway are available to applicants who meet membership, insurability and residency requirements.
@sonsofnorway
December 2022
11

Viking Magazine - December 2022

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