Now is a great time to cut expenses where you can and put the savings into financial instruments that will take care of you down the road, writes trainer Bridge Hennessey.

Recessions don’t send invitations, they arrive unannounced, reshuffling job markets, consumer confidence, and investment portfolios. But for the financially motivated and moderately risk-tolerant, downturns are not a time to panic, they are a time to pivot.

Now is an exceptional opportunity to audit your spending, tighten the reins on unnecessary expenses, and channel savings into well-selected financial instruments that offer growth, stability, and long-term peace of mind. Below are seven practical, recession-tested strategies to help you weather economic storms and come out stronger on the other side.

1. Track Every Dollar and Trim the Excess

Begin with a ruthless review of your spending. Are you still paying for subscriptions you don’t use? Dining out four times a week? These habits add up. Use budgeting tools like YNAB, EveryDollar, or even a simple Excel sheet to categorize expenses. Your goal? Eliminate 10–15% of your monthly outflow and reroute it toward your future.

2. Refinance or Renegotiate

Interest rates shift during economic downturns. If you carry debt, from your mortgage to auto loans, now may be the perfect time to refinance or renegotiate terms. Even a 1% drop in your mortgage rate can translate into thousands saved over time. And don’t hesitate to call your service providers: cellphone, internet, insurance and ask for better deals. Heck call all of them!

3. Build a Tactical Emergency Fund

While financial pundits often recommend 3–6 months of expenses in cash, in a recession, a liquidity buffer becomes non-negotiable. This is not money sitting in a checking account earning nothing. Park it in a high-yield savings account (currently offering 4–5%) or a money market fund. This allows your safety net to grow while remaining accessible.

4. Embrace Smart, Moderate-Risk Investing

The fear of losing money often drives savers to sit on the sidelines, but recessions often create discounted entry points into resilient assets. Consider ETFs focused on dividend-paying blue-chip companies, bonds with staggered maturities, or low-cost index funds. These tools are ideal for those who want upside exposure without excessive volatility.

5. Take Advantage of Tax-Advantaged Accounts

Now is the time to maximize contributions to your RRSP (Canada) or 401(k)/IRA (US). Contributions reduce your taxable income today and help build wealth for tomorrow. If you can’t max them out, aim to increase contributions by even 1–2%, a small move that compounds significantly over time.

6. Delay Big Purchases Strategically

Put off non-essential big-ticket items like new cars, furniture, or vacations. Market uncertainty makes now a poor time to incur new liabilities. Redirect that money into instruments that will reward your patience, like GICs, CDs, or laddered bond portfolios that offer stable returns.

7. Invest in Your Own Earning Power

When jobs become scarce, skill becomes currency. Consider investing in certifications, online courses, or training that increases your value in the job market. Platforms like Udemy, Coursera, LinkedIn Learning, and edX offer affordable access to high-level content in finance, tech, and leadership, fields that remain recession-resilient. Invest in yourself, keep up with today's new technologies.

Preparation Beats Panic

The savviest investors and savers know that wealth isn’t just built in bull markets. It’s protected and often made, during downturns. The key is strategy over emotion, and discipline over impulse. Buy Lows

Cut where you can. Save where you must. And invest where it counts.

Your future self will thank you.